The sale of some or all of Genting Hong Kong’s global assets, including cruise ships and shipyards, could become a reality after the company confirmed the appointment of joint provisional liquidators by a Bermuda court.
The provisional liquidators, named as Edward Middleton and Tiffany Wong Wing Sze of Hong Kong’s Alvarez & Marsal Asia Limited and Edward Whittaker of R&H Services Limited in Bermuda, have been tasked with helping to develop and propose a restructuring proposal in respect of the company’s debts, which include almost US$2.8 billion that formed part of financing arrangements reached with creditors in June last year.
Those agreements followed the group’s announcement in August 2020 that it was suspending all payments to financial creditors in order to preserve liquidity due to the impact of the COVID-19 pandemic on its businesses.
However, with the pandemic still raging, Genting Hong Kong revealed earlier this month that it was in danger of defaulting on its loans after failing to drawdown a US$88 million backstop facility from the State of Mecklenburg Vorpommern for the continued operation of its Germany shipbuilding subsidiary, MV Werften Holdings Ltd (MVWH).
With MV Werften having already filed for insolvency since, Genting Hong Kong said Friday that the appointment of the joint provisional liquidators would see them given “extensive executive powers” over the company.
This could include facilitating and assisting the company in developing and proposing a restructuring of debt in a manner designed to allow it to continue as a going concern.
If no compromise or arrangement with creditors can be reached, the liquidators will be “authorised to dispose of all or certain of the company’s assets with a view to maximising value and returns for creditors of the company.”
Trading of the Genting Hong Kong shares on the Hong Kong Stock Exchanges remains suspended.