KUALA LUMPUR, Aug 20 — A cruise ship operator managed by one of Genting Group’s heirs has suspended its pending payments to creditors, a move seen as triggering a 33 per cent drop in its shares on the Hong Kong Stock Exchange, Bloomberg reported.
In a statement, Genting Hong Kong Ltd, which is controlled by Tan Sri Lim Kok Thay, said that since it needs to preserve as much liquidity of the group as it can, and to fulfil its fiduciary duties, the company would temporarily suspend all payments to its financial creditors, which includes interest and charter payments.
“The Company’s remaining available cash will be reserved to maintain critical services for the group’s operations, while the company will endeavor to negotiate a holistic debt restructuring solution for the current financial indebtedness of the group and continue to engage with interested parties identified by the funding advisers,” the statement read.
Genting Hong Kong added that sailing activities worldwide came to a grinding halt as the Covid-19 pandemic took hold, and given the uncertainty of the situation, it had issued a profit warning announcement for its results for six months, ended June 30, 2020, on March 13 and August 7.
It added that a fundraising exercise has also begun, to help the company weather the financial blitz.
“The Covid-19 pandemic has had, and will continue to have a material impact on the financial position and results of operation of the group. The group has undertaken a number of cost reduction and cash conservation measures to mitigate the effects of the resultant loss of revenues from its operations.
“In addition, the company has mandated certain financial institutions to arrange a fundraising exercise for the group,” the statement read further, adding that the company’s funding advisers had delivered a report on parties interested in the exercise to its board of directors on August 19, 2020.
Genting Hong Kong said that its board has also been informed that all parties will require more time to assess the provision of additional funding, adding that presently, there is currently a lack of certainty as to the outcome of the fundraising exercise.
In its report this morning, Bloomberg reported that Genting Hong Kong shares were down by a record 33 per cent at 10:37am local time, while Genting Bhd shares were untraded due to public holiday in Malaysia.
Genting Singapore Ltd’s shares fell 1.4 per cent.
