KUALA LUMPUR (Nov 3): KNM Group Bhd said it will appeal against a High Court decision to dismiss its application to extend the restraining order against its scheme creditors.

In the meantime, the group was granted an interim restraining order under the Erinford Injunction, it said in its filing dated Nov 2.

KNM had secured the restraining order against its creditors since Dec 15, 2022, which was later extended to Aug 14, 2023, concurrent with its court application to conduct meetings to consider a proposed scheme of arrangement. 

In August, KNM scheme creditors were restrained from taking action against the company through an ad interim order by the court until the disposal of its application to extend the actual restraining order — which was dismissed by the court on Thursday.

KNM’s initial deadline to submit its Practice Note 17 regularisation plan was on Tuesday, however it submitted an application on Oct 30 extend the deadline by one year to Oct 30, 2024.

The company fell into PN17 in end-October 2022 as its current liabilities exceed its current assets, after a deal fell through to dispose of its German machinery manufacturer Borsig Gmbh to pare its debt, some of which it missed payment as early as in November 2021.

At end-June, KNM had short- and long-term borrowings of RM1.08 billion and RM96 million respectively, against cash of RM235.56 million. Total equity stood at RM772.36 million including negative reserves of RM1.21 billion.

The group had net assets of RM772.36 million or 19 sen per share, based on its latest share base of 4.045 billion shares at June 7. This includes RM450.39 million of goodwill under its non-current assets.

Shares of the company closed half a sen or 5.26% higher at 10 sen, giving it a market capitalization of RM404.59 million.