Swiber Says Considering Legal Action Against AMTCBy
Interim manager says AMTC has failed to uphold planned deal
Private equity firm had agreed to inject $200M into Swiber
Swiber Holdings Ltd.’s interim judicial managers said the troubled Singaporean company is studying legal action against AMTC, after the London-based private equity firm failed to follow through on a planned $200 million investment in the oil services firm.
The court-appointed managers said in a statement that AMTC representatives had not contacted them after Singapore’s Business Times reported on Saturday "that the deal with Swiber was still alive and that a representative from AMTC had flown to Singapore last week to work on it," the statement said.
The statement added that the court-appointed managers remained open to hearing from all possible investors in Swiber. “We are open to discussions with any serious investors,” said Bob Yap, one of three court-appointed managers.
An AMTC office manager, contacted by phone in London on Thursday morning, said the firm was unable to comment.
Swiber has been operating under interim judicial management after it dropped an earlier liquidation plan last month following talks with creditors.
Swiber said it was unable to make a coupon payment on Aug. 2. The company has four bonds worth S$460 million ($342 million) and 450 million yuan ($68 million) debt outstanding, according to data compiled by Bloomberg. It took two short-term loans from DBS Group Holdings Ltd. to pay off bonds in June and July, pledging more of its assets to the lender as security.
DBS, Southeast Asia’s biggest lender, said last month it has about S$700 million ($521 million) in total exposure to Swiber. The bank has said it expects to recover half of that amount.
Swiber provides construction services for international oil and gas projects, and has been hit by persistently low oil prices. AMTC entered the picture in June, as Swiber struggled to put its operations in order, but has failed to come up with much-needed capital after several rounds of talks.
On June 9, AMTC signed an agreement with Swiber Investment Limited (SIL) whereby AMTC would subscribe for 1,000 preference shares issued by SIL for a total of US$200 million, according to an announcement by Swiber Holdings on 11 July 2016, the interim managers said in the statement.
Initially, the deal had to be completed before June 16, a date that was later delayed to June 29. On June 27 AMTC requested a further extension of the deadline, which was rejected, and has been in breach of the deal since, the managers said.