Baker & McKenzie.Wong & Leow Advises Jaya Group on the Restructuring of its S$1 Billion Plus Debts
Deal Announcement
February 1, 2010
Singapore, 1 February 2010 – Baker & McKenzie.Wong & Leow advised SGX listed Jaya Holdings Limited and its subsidiaries (the “Jaya Group”) on the restructuring of its substantial bank and trade debts, amounting to over S$1 billion, in the short space of 7 months.
The Jaya Group is engaged in the business of building, selling and chartering out marine support vessels for the offshore oil industry. It was adversely affected by the pull back in bank lending and fall in oil prices in the last quarter of 2008 and early 2009. In mid 2009, the Jaya Group announced a debt repayment standstill. The Group and its advisers worked tirelessly in the second half of 2009 to bring together its 13 bank lenders and their different facilities, and to maintain the confidence of its trade suppliers and customers. The successful restructuring was accomplished by a strategy of transparency of detailed information and forward planning, and a series of steps taken to protect the assets of the Group against adverse seizure and litigation.
Ultimately, the restructuring consists of three interdependent schemes of arrangement that involve complex rescheduling of debts and a stable vessel construction programme, with multi-jurisdictional security documentation. The schemes were approved by the creditors on 28 January 2010. It was notable that all the creditors present and voting approved the schemes. It is still necessary for the High Court of Singapore to sanction the schemes and the hearings are expected before the middle of February 2010.
The transaction is also notable for its size, as it is the biggest corporate restructuring to occur in Singapore following the recent financial crisis.
The restructuring brought together Baker & McKenzie.Wong & Leow’s talents in the corporate, disputes and banking groups and was led by Chuan Thye Tan, Ai Ai Wong and James Huang.
Principal Chuan Thye Tan, the head of Baker & McKenzie.Wong & Leow’s financial restructuring & insolvency and dispute resolution groups said “Throughout the process, there were doubters who considered that the differing interests of the creditors and the scale of the debts too challenging to be restructured, much less in any time-frame short of 12 months. The vote on 28 January demonstrates what can be achieved by serious dedicated professionals working alongside committed stakeholders.”