Lecca Group comes in as Barakah Offshore white knight

Malaysian offshore service provider Barakah Offshore has proposed a regularisation plan under which the company will enter a series of deals with Singapore’s Lecca Group in order to improve its financial situation.

The regularisation plan includes the disposal of a pipelay barge to Lecca Group for $21m, as well as a share capital reduction, share placements, plus debt settlements through the issuance of redeemable unsecured loan stocks.

Following the completion of the deals, Lecca Group will become the single largest shareholder of Barakah Offshore with a 44.87% equity interest.

The proceeds of RM88m ($21.2m) raised from the proposed disposal will be used for the partial repayment of debt owing to EXIM Bank.

Furthermore, Lecca Group will be granted an option to subscribe up to an additional 250m shares, while Barakah will also seek for an exemption for Lecca to undertake a mandatory general offer to acquire the remaining Barakah shares it does not own.

As of the end of May, Barakah Offshore and its subsidiary PBJV’s total outstanding liabilities amounted to RM106.65m ($25.75m) and RM287.99m ($69.52m) respectively.

Barakah Offshore said that the proposed regularisation plan was formulated to address and uplift its Practice Note 17 (PN17) status, by returning the company to a better financial standing and settlement of scheme creditors.

Jason Jiang

Jason is one of the most prolific writers on the diverse China shipping & logistics industry and his access to the major maritime players with business in China has proved an invaluable source of exclusives. Having been working at Asia Shipping Media since inception, Jason is the chief correspondent of Splash and associate editor of Maritime CEO magazine. Previously he had written for a host of titles including Supply Chain Asia, Cargo Facts and Air Cargo Week.
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