Nam Cheong to Restructure in Blow to Singapore Bond Market
- Group won’t be able to pay interest and principal on debt
- Debt restructuring entails haircut, debt-to-equity conversion
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Nam Cheong Ltd. is set to renege on some of its borrowings, in the latest blow to Singapore’s bond market as the shipbuilding and offshore oilfield services industry struggles to rebound from a slump in oil.
The Kuala Lumpur-based group has decided to temporarily cease repayment on all borrowings, including a semi-annual coupon due July 23 on S$75 million ($55 million) of notes, it said in a Singapore exchange filing Thursday. The group, which had 1.84 billion ringgit ($429 million) of bank loans and bonds on March 31, is seeking a moratorium on principal repayments and asking creditors for a haircut and to convert their debt into equity.