KUCHING: Serba Dinamik Holdings Bhd’s (SDHB) subsidiaries have defaulted on payment of three financing facilities totalling about RM435.4 million.
Wholly-owned subsidiary Serba Dinamik Group Bhd (SDGB) has defaulted on its payment of the Islamic Club Financing Arrangement provided by MBSB Bank Bhd and Bank Kerjasama Rakyat Malaysia Bhd (collectively, the club banks) of RM400.77 million.
The reason given for the payment default is “constrained cash flows to settle outstanding payment to MBSB”, SDHB said in a filing with Bursa Malaysia.
On Jan 10, 2023, Victor Saw Seng Kee of PricewaterhouseCoopers Advisory Services Sdn Bhd was appointed as liquidator of SDHB, SDGB, Serba Dinamik Sdn Bhd and Serba Dinamik International Ltd.
MBSB as the custodian bank had initiated legal proceedings against SDGB to exercise its rights as secured creditor, as per the terms of the financing agreements.
“The liquidator and his team have reached out to the club banks to discuss the outcome that serves the best interests of SDGB as well as the club banks,” according to SDHB.
SDHB said it shall endeavour to continue its business and operations despite the default.
“The company is undertaking several restructuring and right-sizing measures together with the liquidator in an effort to reduce the cash outflows and improve cash inflows. This forms part of the company’s restructuring and regularisation plan.
According to SDHB, the financing facility was secured by a first party first legal charge over several parcels of land by SDGB, together with the buildings erected on them in Mukim Pantai Timur, Kota Tinggi district, Johor.
“There is no debenture under the facility. However, based on a facility agreement, the club banks are empowered to appoint a receiver in the event of default in payment.
“The default in payment will give rise to several other potential events of default of the indebtedness under the company by virtue of the cross-default provision under the respective financing agreements,” added the company.
SDGB has also defaulted on its payment for Tawarruq Term Financing-i provided by Affin Islamic Bank Bhd amounting to RM34.41 million.
“The winding up of SDGB triggered the event of default. SDGB is unable to pay all outstanding amounts due to Affin Bank at the time of default.
“The liquidator and his team have reached out to Affin Bank to discuss an outcome that serves the best interest of SDGB as well as Affin Bank,” said SDHB.
Affin Bank has 1st party legal charge over a building held in Shah Alam, Petaling district, Selangor. Based on a facility agreement, Affin Bank is empowered to appoint a receiver in the event of default payment.
Another wholly-owned subsidiary Serba Dinamik Sdn Bhd (SDSB) has defaulted on its payment of the Bai’ Inah facility provided by Small Medium Enterprise Development Bank Malaysia Bhd (SME Bank) for RM228,568 as at Dec 22, 2022 inclusive of compensation for late payment charges equivalent to the actual loss at the rate of one per cent per annum on the overdue amount.
The facility had been fully settled as at June 1, 2023, said SDHB, adding that it does not expect any further impact on SDSB.
“To the best of our knowledge, SDSB had pledged fixed deposits as security for the repayment of the facility granted by SME Bank,” according to SDHB.
