Aug 20, 2020 Newsdesk Latest News, Philippines, Top of the deck
Genting Hong Kong Ltd says it will “temporarily suspend all payments to the group’s financial creditors”. The company added it is in negotiations with potential interested parties for a fund-raising exercise.
It said “more time” would be required for the negotiations regarding additional funding for Genting Hong Kong. “There is currently a lack of certainty as to the outcome of the fund-raising exercise”, it warned.
The Hong Kong-listed company is an operator of casino cruise ships and shipyards, as well as an investor in the Resorts World Manila casino resort in the Philippines. The latter property is a venture with Philippine conglomerate Alliance Global Group Inc.
It was unclear from Genting Hong Kong’s filing what would be the impact – if any – on Resorts World Manila, regarding Genting Hong Kong’s decision to suspend all payments to its financial creditors.
The Hong Kong-listed firm said that, pending any fund-raising exercise, its board had decided the company should “temporarily suspend all payments to the group’s financial creditors (including interest and charter payments)”. That was in order to “preserve as much liquidity of the group as possible.”
Genting Hong Kong confirmed that two of its subsidiaries had already defaulted, earlier this week, on the payment of approximately EUR 3.7 million (US$477,000) in aggregate related to financing activities for its ship building segment. It said that its decision to suspend payments to financial creditors would “likely result in events of default occurring under other finance documents of the group”.
As of July 31, the outstanding financial indebtedness of Genting Hong Kong stood at US$3.37 billion, the firm said.
Genting Kong said that the company’s remaining available cash would be reserved to “maintain critical services” for the group’s operations. In the meantime, the firm would “endeavour to negotiate a holistic debt restructuring solution” for its current financial indebtedness.
The firm said it had already “undertaken a number of cost reduction and cash conservation measures” to mitigate the negative effects on business from the Covid-19 pandemic. In addition, Genting Hong Kong planned to call for a creditors’ meeting to be hosted online, to provide creditors with further information on the current status of the group’s operations and finances, “along with restructuring and/or refinancing options in respect of the group’s financial indebtedness”.
Genting Hong Kong said earlier this month it expected to record an unaudited consolidated net loss of “not less than US$600 million” for the six months ended June 30. The company said the lacklustre result was because of suspension of most its operations within the latest reporting period due to Covid-19.
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