Vallianz set to resolve debt woes

Singapore-based offshore vessel owner Vallianz has reached agreements with Swiber and Rawabi to restructure its $138.7 million debt.

Swiber, which holds 903,534,986 shares or 20.9% equity interests in Vallianz, had on October 13, 2016 notified the company of its interest to participate in the renounceable non-underwritten rights cum warrants issue proposed by Vallianz on September 6, 2016.

Following discussions with Swiber, both parties have entered into an agreement to convert net payables to Swiber of $36.6 million into shares in Vallianz’s capital through the Proposed Rights cum Warrants Issue, upon the fulfilment of certain conditions.

Any balance net payables to Swiber following Swiber’s subscription of any rights shares with warrants and any exercise of the warrants thereon will be settled via further new equity in the future, Vallianz said.

Furthermore, Vallianz’s  strategic shareholder and partner Rawabi has also agreed to convert its shareholder’s advances to the company of $102.1 million into equity from its subscription to the Proposed Rights cum Warrants Issue.

Rawabi will also undertake to subscribe for the excess rights in the Proposed Rights cum Warrants Issue, where available. Any balance shareholder’s advances owing to Rawabi following the subscription of the Rights Issue and exercise of the Warrants thereon will be settled via further new equity in the foreseeable future.

Rawabi presently owns 672,000,000 shares in Vallianz, representing 15.6% of total share capital. Subject to the fulfilment of certain conditions and completion of the Proposed Rights cum Warrants Issue, the proposed conversion of the shareholder’s advances could result in Rawabi becoming the largest single shareholder of Vallianz.

Ling Yong Wah, CEO of Vallianz said the deal with Swiber represented “a critical step in the restructuring efforts of the Company.”

“It provides clarity on the intention of both parties to move forward with a planned resolution on the net payables issue. Rawabi continues to demonstrate its strong support through the intention to significantly raise its shareholding in Vallianz.  By fulfilling the Group’s financial obligations towards Rawabi and Swiber using equity, we will be able to conserve our cash resources for working capital and strengthen the Group’s equity base. Moving from here, the Group plans to resume its Proposed Rights cum Warrants Issue exercise as soon as practicable,” he said.

Sheikh Abdulaziz AlTurki, Group Chairman of Rawabi, said: “Our decision to increase our stake in Vallianz reflects our unwavering confidence in the Group’s business and prospects. As a strategic  shareholder and partner, Rawabi is committed to working with Vallianz to sustain and grow the Group’s offshore marine services business over the long term.”

The Proposed Rights cum Warrants Issue is subject to the approval of shareholders at an Extraordinary General Meeting (“EGM”) to be convened.

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