Genting Hong Kong has confirmed it is analysing the possibility of filing for liquidation after a German court denied its request for the release of a US$88m loan arrangement.
Hong Kong.- Genting Hong Kong said it was considering filing for liquidation after a German court rejected a request to release US$88m in funds for its German shipyard unit MV Werften, which has recently filed for bankruptcy. The company was unable to reach an agreement with German authorities to get financial assistance to finish building a massive cruise liner.
The company said last week that the bankruptcy filing would trigger a cross-default event under Genting Group’s financing arrangement, amounting to US$2.78bn.
The company said through a filing: “Unless the company receives credible proposals for a solvent, consensual and inter-conditional restructuring solution, the board will potentially proceed with a filing of provisional liquidation of the company with the competent court of Bermuda on 18 January 2022.”
It added: “The appointment of provisional liquidators is essential and in the interests of the company, its shareholders and its creditors to maximize the chance of success of the financial restructuring and to provide a moratorium on claims and to seek to avoid a disorderly liquidation of the company by any creditors.”
According to Associated Press, Germany blamed Genting HK for the collapse of the shipyard business. German authorities said they were open to discussing a €600m (US$678m) rescue plan but wanted Genting HK to contribute at least 10 per cent to the rescue effort.
The company shares plunged 56 per cent after the company’s shipyard located in Germany filed for bankruptcy.