1. What did Sapura Energy announce on 10 March?
Sapura Energy announced that the Group and 22 (collectively, the “Applicants”) of its wholly-owned subsidiaries obtained two Orders from the High Court of Malaya at Kuala Lumpur:
- an order to convene meetings with creditors to consider and approve a proposed schemes of arrangement and
- a restraining order to restrain and stay all legal proceedings against the Applicants
2. What is a Scheme of Arrangement?
A scheme of arrangement is a corporate restructuring mechanism provided for under Section 366 of the Companies Act 2016. Under the Court’s order, each company shall convene meetings with its creditors to consider a scheme of arrangement proposed by the company. The scheme of arrangement will state how the company intends to settle its outstanding debts to the creditors.If the scheme of arrangement is approved by a majority of 75% of each class of creditors and final court sanction is granted for such a scheme, the scheme of arrangement will be binding on all creditors of the company.
3. What is the Restraining Order?
The Restraining Order is an order granted by the High Court under Section 368 of the Companies Act 2016.The Restraining Order means any legal proceeding against the company will be halted for a period of 3 months from the date of the Restraining Order.Subject to certain conditions, the company may apply to extend the period of restraint for not more than 9 months.
4. Why did Sapura Energy apply for these Orders?
The Orders were applied for as part of the Sapura Energy group’s proposed debt restructuring plan. Sapura Energy is still facing extreme financial constraints and liquidity issues, making it difficult for us to resolve outstanding payments to creditors. The proposed schemes of arrangement represent the best long-term solution for the Group to address these challenges. The proposed schemes of arrangement, if approved by the creditors and sanctioned by the Court, will enable the Group to carry out its proposed debt restructuring and provide a framework for payment to our creditors.
The Restraining Order enables us to negotiate the proposed schemes of arrangement without the disruption of threatened and ongoing legal proceedings. Ensuring our operations are ongoing means we can continue to deliver our promises to clients and provide work to our vendors.
5. How do I know if the Orders affect me?
The Orders affect creditors who have outstanding claims for services rendered on or before 31 January 2022, with companies listed here. We will formally notify all such creditors through a letter, within one week from the date of the Orders and continue to update creditors, in due course.
6. What happens next?
To kick off the engagement process, we will organize initial briefing sessions with creditors before the end of March 2022. We will formally notify our creditors of the date for these discussions, as soon as we can
7. How long does it take for a vendor to be paid once the SOA is in place?
The schedule will be part of the agreed Schemes of Arrangement, as voted upon by the majority of creditors.
8. What happens to my claims if Sapura Energy goes into liquidation?
The objective of the Proposed Debt Restructuring is to achieve a better outcome for all parties than in a liquidation scenario. The proposed Schemes of Arrangement provide flexibility for each of the Applicant to agree to a commercially viable settlement of its debts with its Creditors. In contrast, in a liquidation, the assets of a company will be liquidated and the proceeds distributed to creditors by a liquidator in strict accordance with the provisions of the Companies Act 2016. The Applicants and the Creditors will have no meaningful control over the liquidation process or the distribution of assets. Additionally, secured creditors will get priority over the assets of the company to satisfy the secured creditors’ debt. After that, any balance will only then be available to the unsecured creditors.
Should you require more information, please reach out to us at one of the following channels
Support Hotline (Available from Mon – Fri, 1000 – 1600 GMT+8):
+603 8659 8338
Email to Helpdesk
Should you have any enquiries beside the information listed on this page. Please submit them in the from below
All media inquiries should be emailed to Sapura Energy’s Strategic Communications Department