THE massive two-part proposal that will see Sembcorp Industries (SCI) and Sembcorp Marine (SMM) parting ways will meet the loss-making marine unit’s “critical” liquidity needs, strengthen both companies’ financial positions and is in the best interest of shareholders. Read more at The Business Times.
DECIDING SAY
SMM also said that continuing to add debt is not a long-term solution, as this will further burden its balance sheet with higher gearing and interest payments at a time when its cash flow and financial flexibility are still constrained by the “challenging market dynamics and outlook”. This will enable SMM to fund ongoing commitments, help the group compete for new high-value projects and ensure long-term viability, it said.
While all of SMM’s business segments have been affected by the current challenging business conditions, the repair and upgrades segment has remained profitable and generated over S$600 million in revenue for FY2019. SMM said it will continue to grow this segment.SCI clarified that under the proposal, it will not “write off” the S$1.5 billion outstanding principal loaned to SMM. Instead, the debt will be converted into an equity stake in SMM via the rights issue.
It added that the settlement also provides value to SCI, in the form of SMM shares. All SCI shareholders will benefit as well, as they will get the flexibility to calibrate their holdings in both companies once there is a clean demerger of SMM after the loan settlement and distribution.Sias argued that SCI’s reduced debt post-transaction may be driven by accounting treatment rather than expected economic improvements to its business.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Beijing envoy says Washington must decide if it is ready to accept rise of ChinaBeijing’s top envoy to the US has urged Washington to decide whether it is ready to accept the rise of China, amid ever-heightening tensions between the strategic rivals.Cui Tiankai told CNN’s Fareed Zakaria in an interview on Sunday that China had the “legitimate right” to modernise into a “strong,
Read more »
Malaysia mulling over compulsory use of face masks in public areas, says PM MuhyiddinPETALING JAYA (THE STAR/ASIA NEWS NETWORK) - The Malaysian government is considering making it compulsory for people to use face masks in public places, with details to be announced soon, Prime Minister Muhyiddin Yassin said on Monday (July 20).. Read more at straitstimes.com.
Read more »
Penalties for violent cases to be reviewed, says Shanmugam following public outcry over dentistry student’s sentence
Read more »
Conte says Serie A getting more competitive despite Juve dominanceInter Milan coach Antonio Conte believes that Serie A is becoming more competitive - even though Juventus are poised to win it for the ninth ...
Read more »
Football: Conte says Serie A getting more competitive despite Juve dominanceInter Milan coach Antonio Conte believes that Serie A is becoming more competitive - even though Juventus are poised to win it for the ninth ...
Read more »
Coco Lee sparks separation rumours with ambiguous post'To mend a broken heart, you need a lot of courage and time,' Coco Lee posted on Weibo.
Read more »