Notable Work

Selected projects by our insolvency and restructuring professionals

Finance

Banking

Visia Finance Berhad, an insolvent finance company, had been placed under the control of Bank Negara Malaysia in 1987 in a move to protect the interests of depositors.

Bank Negara made an application to the High Court for the appointment of receivers and managers to manage the business affairs and property of the finance company. The application was authorized by the Finance Minister by an Order published in the Gazette on 19 August 1993, pursuant to
Section 73(2) of the Banking and Financial Institutions Act, 1989.

The business operations and properties were transferred to Hong Leong Finance Berhad when they took over the business and assets.

Finance

DTCS

Jabatan Pembangunan Koperasi conducted inquiries into a number of deposit-taking cooperatives ("DTC") including the 24 DTC under the powers vested in it by Section 37(1 of the Cooperative Societies Act, 1948.

Significant withdrawals that reflected the diminishing confidence of members and depositors in these cooperatives had resulted in the introduction of the Essential (Protection of Depositors) Regulations 1986, under the Emergency (Essential Powers) Act, 1979. Bank Negara Malaysia was granted the necessary authority to act upon certain deviating DTCs.

The High Court of Malaysia appointed receivers to deal with the business affairs of two (2) cooperatives, Koperasi Wartawan Berhad and Koperasi ENE Berhad, which had about 5,000 and 10,000 depositors respectively. Besides managing the cooperatives and successfully making payouts to depositors, the remaining business was transferred to two (2) financial institutions.

Finance

Insurance

Mercantile Insurance San. Bhd. was wound up by the Director-General of Insurance (under Bank Negara Malaysia). This general insurance company was the largest motor insurance company at that time with thirteen (13) branches throughout Malaysia.

The winding-up involved the Insurance Guarantee Scheme Fund, funded by local insurers and governed by Bank Negara Malaysia, whereby all valid claims meeting a specific criterion and subsequently admitted by the liquidators would receive an upfront cash payment of 70 sen to the ringgit from the fund. These claims, totaling more than 50,000 with face values of more than RM1.2 billion, were assessed, evaluated and paid in a relatively short time.

The business operations were continued with the involvement of its 350 employees, and more than 5,000 legal actions in the Courts against the company were defended successfully.

Finance

Danaharta

Pengurusan Danaharta Nasional Berhad was incorporated by the Government of Malaysia to acquire non-performing loans from the banking system, thereby strengthening confidence in the Malaysian economy hit by the Asian financial crisis of 1997/98.

This national asset management company was granted powers under the Pengurusan Danaharta Nasional Berhad Act, 1998 to recover non-performing loans, amongst others, through the appointment of Special Administrators. Under Special Administration, the operations of companies are continued until they are sold.

In this regard, we conducted numerous exercises to identify 'white knights' to acquire the stockbroking businesses of WK Securities Sdn Bhd, Alor Setar Securities Sdn Bhd and MGIC Securities Sdn Bhd; the tin mining and plantations business of Rahman Hydraulic Tin Berhad; the timber businesses of Kilang Papan Seribu Daya Berhad and MGR Corporation Berhad; the building materials business of NCK Corporation Berhad; and the restructuring of Perusahaan Sadur Timah Malaysia Berhad or PERSTIMA.

Since most of these companies were public-listed, our work also involved fulfilling the requirements of regulatory bodies, namely Bursa Malaysia Berhad and the Securities Commission of Malaysia.

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Manufacturing

Integrated Monorail System

Scomi Rail Berhad ("SRB"), is a wholly-owned subsidiary of Scomi Engineering Bhd ("SEB"), which in turn is a wholly-owned subsidiary of Scomi Group Berhad. The company is one of the world's three leading providers of monorail systems and one of only four globally recognised integrated
monorail system providers. The company is mainly involved in the design, manufacture and supply of monorail trains and provision of related engineering support services and engineering works.

In 2019, we were appointed Receiver and Manager by the Secured Lender due to the company defaulting on its loan of RM200 million. As Receiver and Manager, we identified an international purchaser for the sale of the company's Intellectual Properties within 12 months of our appointment.

Manufacturing

Industrial And Commercial Plant

With origins stretching back more than 50 years, Seamaster Paint is a leading paint manufacturers and a pioneer in commercial and industrial paint manufacturing.

Through a successful operational restructuring aimed at optimizing resource utilization, we were able to address cash flow challenges leading to a comprehensive overhaul and revamping of the business plan.

In addition, we were involved in the exit strategy for some of the shareholders.

Manufacturing

Baggage Handling System

Malaysian AE Models Holdings Berhad ("MAE") is a public-listed investment holding company that specializes in the manufacturing and installation of bulk material handling systems. At its peak, MAE generated annual sales of over RM650 million and managed its operations through various
offices in China, Indonesia, Singapore and Malaysia. The company encountered financial difficulties in 2013 and defaulted close to RM450 million of facilities owed to local financial institutions.

Our team took control of MAE and stabilized its financial position by re-organizing the operations and human resources of the company. The business practices of the company was dubious which resulted in a forensic investigation leading to us reporting our findings to the Securities Commission. Within 2 years of our appointment, we realized a substantial amount of assets and the receivership was completed.

Manufacturing

Consumer Goods

Khee San Food Industries San. Bhd. ("KS+l" is a subsidiary of Thee San Berhad, a company listed on the Main Board of Bursa Malaysia. The companys business nature is the manufacturing of candy confectionery for local and export markets.

In November 2021, the company underwent Interim Judicial Management and was placed under the supervision of the High Court, with Dato' Adam Primus appointed as the Interim Judicial Manager ("JM") to safeguard the assets and business of the company.

Under our professional guidance in operations, management, sales and marketing, finance, and human resources, the company embarked on a business restructuring process. The efforts proved fruitful as the business turnaround yielded remarkable results within just 10 months. The company's
monthly sales increased from RM2 million to RM8 million as of October 2022, leading the creditors to bargain for a better recovery sum from RM30 million to RM68 million through the scheme promoted by the company.

We played a crucial role in advising the banks on the terms of the scheme of arrangement proposed by the company.

Manufacturing

Textile

Hualon Corporation (M) Sdn. Bhd. ("Hualon") was once, one of the largest fully integrated textile manufacturers in the world and the largest textile producer in Malaysia. The company achieved annual turnovers averaging RM3 billion from an international customer base. The production facility comprised 27 factories and plants in Nilai and Melaka, covering an area of 230 acres. Hualon had approximately 7,250 employees and was the largest employer in Nilai, Negeri Sembilan.

The company entered receivership in 2006 where secured lenders alone, comprising a majority of banks in Malaysia, were owed about RM4 billion.

The strategies we adopted with most of the creditors enabled our team to keep business operations intact and viable using internal generated funds. We conducted an international tender and successfully identified Reliance Industries Limited of India as the purchaser of the business.

The business, together with its employees, has been seamlessly transferred to the purchaser and is now operating profitably. The secured lenders recovered about 20% of the amounts due within a period of 2 years of our appointment.

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Property Development

TPPT

Tabung Pemulihan Projek Terbengkalai ("TPPT"), the abandoned housing projects fund, was established in 1990 with the specific objectives of reviving abandoned housing projects and to provide house buyers good titles to these houses. The Government initially allocated RM300 million to a
revolving fund managed by TPPT Sdn Bhd, which was subsequently increased to RM500 million.

Fifteen (15) housing projects were managed by us in all aspects, including completing viability studies and making presentations on our recommendations to the TPPT panel, chaired by Bank Negara Malaysia. The housing projects were completed with the support of Bank Negara Malaysia with soft loans of RM62 million.

Property Development

Plaza Rakyat

Plaza Rakyat Sdn. Bhd. is a property development company responsible for initiating and introducing the concept of a transportation hub cum residential and commercial center spread over 15.3 acres of prime development land in the Kuala Lumpur city centre.

Termed as the Plaza Rakyat project, the scheme was to be developed under a joint-venture agreement between the local authorities and the company. The project was abandoned in the aftermath of the Asian Financial Crisis of 1997/1998 affecting thousands of purchasers and resulting
in the default of the company's obligations to its lenders.

The abandonment of the project was followed by a series of intricate legal disputes between its joint-venture partners. Our involvement in the project came 20 years after its abandonment after various means of reconciliatory measures between the parties had failed to achieve the
desired outcome.

Through calculated strategy and thoughtful implementation, we successfully concluded the legal disputes between the parties. Consequently, the parties made necessary concessions to settle the liabilities due to the lenders. In less than 24 months into our appointment, our team managed to end the engagement with cash recovery to the lenders.

Property Development

168 Selayang

168 Selayang is a mixed development project that encompasses 1,433 apartments spread across three blocks, along with a retail shopping mall. The project was abandoned as a result of the main developer's insolvency.

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Our role was to formulate a scheme together with the white knight and the shareholders of the company to implement the proposed rehabilitation of the abandoned development. We successfully resolved various issues, including addressing Liquidated Ascertained Damages (LAD) owed to the buyers, completing the first tower, efficiently transferring purchasers to a single block, and addressing the nominated subcontractor's claim.

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The project is currently on-going.

Property Development

Dolomite Group

In October 2022, we were appointed liquidator of Dolomite Corporation Berhad ("DCB"). DCB is an investment holding company which owns 100% equity interest in a group of companies involved in construction, manufacturing of building materials, property development and thermal power generation. Within a month of our appointment, we took control of the group by appointing our nominee Directors in all subsidiary companies in Malaysia and Hong Kong, China. By 20 June 2023, all Malaysian subsidiaries were placed in liquidation as these companies were insolvent.

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At the date of our appointment, the business operations of the group had ceased and our focus was to identify potential buyers for the remaining assets of the group, which includes commercial lands totalling 80 acres with active development orders and partially completed housing developments.

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Through our sale process, we identified a purchaser interested in acquiring the entire equity of two subsidiary companies together with all the real properties of the group for a consideration of RM65 million under a Scheme of Arrangement.

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Utility

Utility Generation

The Northern Utility Resources Group ("NUR Group") - comprising Northern Utility Resources Sdn Bhd, NUR Generation Sdn Bhd, and NUR DistributionSdn Bhd - is a flagship project forming part of the Government of Malaysia's vision to promote the high-technology electronics industry. The NURGroup was the first 220 MW "in-situ mini utility" with concession terms covering the generation, transmission and distribution of power to the broad community and tenants at the Kulim Hi-Tech Park in Kedah Darul Aman. The NUR Group provides Reliability, Quality and Security (RQS) energy to high-technology companies in the area.

The Secured Lenders were owed RM1.6 billion and placed the NUR Group in receivership in 2004. The business operations, especially the generation units, were not in service.

Within 3 months of our appointment, we signed a sale and purchase agreement with TNB for RM1 billion. After termination of the sales and purchase agreement, we successfully commissioned facilities to meet the tremendous load growth in the Park from 60 MW in 2004 to 200 MW. In the process, all invaluable licenses and concession terms were met, avoiding revocation of the same. With the operating companies rehabilitated, an international tender successfully identified a local company as the purchaser.

Utility

Biotechnology Park

Malaysian Bio-XCell Sdn. Bhd ("Bio-XCell"), is a joint venture company owned by Malaysian Bioeconomy Development Corporation Sdn Bhd (via its wholly owned subsidiary BiotechCorp Investment Holdings Sdn Bhd) and UEM Sunrise Berhad. Bio-Cell's principle activity is the development and
operation of a biotechnology park located on approximately 88 acres of land in Iskandar Puteri, Johor. The key feature of the biotechnology park is the specialized Central Utilities Facility (CUF). The main tenant of the park is Asia's top insulin manufacturer and relies heavily on the CUF for its operations.

In 2019, the Secured Lender appointed us Receiver and Manager due to the company defaulting on its loan of RM250 million. Immediately upon our appointment, we had administered the company's operation without disrupting the operations of its tenant. Within 6 weeks of our appointment, we
advertised for the sale of the company's properties in major newspapers within Malaysia and Singapore. We successfully identified purchasers for all of the company's properties and made full repayment to the Secured Creditors within 24 months of our appointment.

Utility

Biomass Energy

Maju Intan Biomass Energy Sdn. Bhd. ("MJE") owns and operates a biomass power plant in Teluk Intan, Perak. It had on March 2012 entered into a renewable energy power purchase agreement with Malaysia's Tenaga Nasional Bhd for the purchase of electricity generated from the power plant on a build-own-operate basis. The power plant has a generating capacity of 12.5 MW utilizing empty fruit bunches, a waste effluent after palm oil is extracted by palm oil millers.

In July 2022, we were appointed Receivers and Managers of MJE by the Secured Lender due to the company defaulting on its loan of RM122 million.

As the appointed Receivers and Managers of MJE, our immediate focus was addressing the company's cash flow challenges. We implemented strategic measures to improve cash flow, allowing us to stabilize and maintain the operations of the power plant effectively, minimizing further disruptions. We safeguarded all concessions and licenses, preserving the company's operational capabilities. Building upon this foundation, we engaged in negotiations with the shareholders and facilitated a favorable settlement for the Secured Lender within 12 months of our appointment.

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