Singapore's Ezion suspends shares, seeks restructuring

Singapore's Ezion suspends shares, seeks restructuring
Ezra Holdings' Lewek Constellation.
PHOTO: Ezra Holdings

SINGAPORE - Singapore-based oil services company Ezion Holdings said trading in its shares would be suspended temporarily as it is in talks with stakeholders such as bank lenders and creditors about its financing and capitalisation structure.

The company, which owns a fleet of liftboats, said it is reviewing its options to strengthen its financial position and preserve value for its stakeholders.

Singapore's offshore and marine industry has been hit by low oil prices, weak charter rates and delays to projects, forcing many firms to restructure debt and cut costs.

Industry peers Swiber Holdings Ltd and Swissco Holdings have sought refuge in court, while Ezra Holdings Ltd filed for US bankruptcy protection.

"While the initial responses from our principal lenders appear positive, the details will need to be finalised," Ezion said.

"The outcome of the above discussions will very much determine if Ezion will survive the current crisis and emerge stronger than before."

Ezion said charter rates for its rigs have been dropping significantly and that was expected to continue for the next 12 months.

The collection of receivables was also slow and significant impairments may be needed if the situation worsens.

The company said its difficulties presented many challenges to its cashflows that "will threaten the fundamental viability of the group's business if these challenges persist."

It had total debt of about $1.4 billion as of end June. Ezion also reported a loss of $2.6 million for the second quarter compared with a profit of $8.1 million a year ago.

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