KUALA LUMPUR (Jan 13): Sapura Energy Bhd (KL:SAPNRG), which has been in Practice Note 17 (PN17) status since end-May 2022, is a step closer to revive its financial health.
The oil & gas (O&G) giant said it has secured approval-in-principle from at least 75% of its financiers for the proposed restructuring of its multi-currency financing facilities.
Sapura Energy said it received written confirmation from the Corporate Debt Restructuring Committee (CDRC) on Saturday (Jan 11), addressing refinements of the terms of the proposed restructuring scheme for its debt restructuring exercise.
“The second approval-in-principle for the proposed restructuring scheme paves the way for court-convened meetings with the relevant classes of creditors of Sapura Energy and its relevant subsidiaries.
“It will also facilitate a prospective financial investment from a white knight,” the company said in a statement.
Sapura Energy and its multi-currency financiers (MCF financiers) have been engaged in CDRC-mediated negotiations since September 2022. The financiers provided their first approval-in-principle in the RM10.3 billion multi-currency financing facilities over a year later in December 2023.
Since then, the group has refined the proposed restructuring scheme, taking into consideration the progress in resolving certain contingent claims through the proof of debt process.
Sapura Energy's interim chairman Shahin Farouque Jammal Ahmad remarked, "With this positive development, Sapura Energy is another step closer to regularising our financial position and emerging from our status as a PN17 company”.
Sapura Energy has until May 31 to submit its regularisation plan to Bursa Malaysia. This marks the fourth extension granted by Bursa Securities, giving the company additional time to complete its turnaround efforts.
The group has been under PN17 status since May 31, 2022, with its initial regularisation plan submission deadline set for May 31, 2023.
Former chief executive officer Datuk Anuar Taib previously expressed hopes of exiting PN17 status by 2026, as the group has been implementing cost-cutting measures and reducing borrowings, including the sale of its 50% stake in upstream business SapuraOMV Upstream Sdn Bhd for RM3.35 billion. The divestment was completed in December 2024.
As of October 2024, Sapura Energy had borrowings totalling RM10.73 billion against cash reserves of RM1.79 billion. Trade payables amounted to RM5.18 billion, while receivables were RM1.39 billion. The group’s accumulated losses stood at RM17.53 billion against share capital of RM11.85 billion.
Shares in Sapura Energy fell half a sen to close at three sen on Monday, giving the company a market capitalisation of RM482.37 million.