logo
KNM proposes RM3.16b debt restructuring, sets creditors' meeting for Aug 11

KNM proposes RM3.16b debt restructuring, sets creditors' meeting for Aug 11

DEBT-LADEN KNM Group Bhd has issued formal notice to its creditors to convene a court-sanctioned meeting on August 11, 2025, to vote on a proposed scheme of arrangement that forms a central component of the group's wider regularisation plan to exit Practice Note 17 (PN17) status.
The scheme – which involves both KNM and its wholly owned unit KNM Process Systems Sdn Bhd (KNMPS) – aims to restructure a combined RM3.16 billion in liabilities as of the June 30, 2023 cut-off date.
The Kuala Lumpur High Court has granted the company an order to hold the meeting and extended a restraining order until August 12 to shield the group from legal action by creditors while the restructuring process unfolds.
Under the proposed arrangement, creditors will be repaid through a combination of immediate cash proceeds and deferred instruments.
The bulk of the initial cash will be sourced from the proposed RM1.3 billion disposal of German-based Deutsche KNM GmbH to Japan's NGK Insulators Ltd.
KNM expects RM983.5 million in net proceeds from the sale after deducting transaction costs, escrow requirements and working capital needs.
Secured creditors of KNMPS are to be repaid in full in cash upon implementation of the scheme.
Unsecured creditors will receive approximately 80.94% of their admitted claims in cash, with the remaining 19.06% to be settled through the issuance of five-year zero-coupon redeemable unsecured loan stocks (RULS).
These bonds will not bear interest and will be repaid progressively over five years via a mix of escrowed funds, asset disposals, and internally generated cash.
KNM has classified creditors into three groups: secured, unsecured, and intercompany.
While secured and unsecured creditors are expected to receive settlements, intercompany balances will only be addressed after other classes are resolved.
Some of these balances may ultimately be waived, according to the scheme's terms.
The RULS will be listed on the Main Market of Bursa Malaysia under the Exempt Regime, which allows for over-the-counter transfers but not public trading.
Redemption will follow a semi-annual waterfall mechanism, using excess cash generated by KNMPS after meeting its six-month working capital needs.
Additional funding will come from the potential release of RM156.6 million held in escrow from the German asset sale, along with proposed disposals of other non-core assets in Italy, the UK and Thailand.
As part of its restructuring, KNM proposes that the liabilities under the holding company – amounting to RM1.23 billion – be substantially settled via KNMPS.
Only RM4.2 million in unsecured claims and RM10.8 million in intercompany dues will be directly addressed by KNMG under the scheme.
The proposed arrangement remains subject to the approval of creditors at the August 11 meeting, sanction by the High Court, Bursa Malaysia's clearance for the regularisation plan and bond listing, and shareholders' endorsement of both the restructuring and asset disposal.
The group fell into PN17 status in 2022 following severe liquidity challenges, operational delays and audit concerns.
It said a comprehensive regularisation plan is in the final stages of formulation and will incorporate both the scheme of arrangement and the German asset disposal.
The Court of Appeal is scheduled to hear KNM's appeal for a longer restraining order on September 18.
The company's current ad-interim order will remain in place until then, providing a temporary buffer from enforcement actions. –TMR

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

FTSE4Good Bursa Malaysia Index adds 19 stocks
FTSE4Good Bursa Malaysia Index adds 19 stocks

The Star

time42 minutes ago

  • The Star

FTSE4Good Bursa Malaysia Index adds 19 stocks

All constituent changes will take effect at the start of business on June 23, 2025. PETALING JAYA: Bursa Malaysia has announced 19 additions to the constituents of the FTSE4Good Bursa Malaysia (F4GBM) Index and 14 inclusions to the constituents of the FTSE4Good Bursa Malaysia Shariah (F4GBMS) Index. In a statement, the stock exchange operator said the F4GBM Index includes publicly listed companies or PLCs with good liquidity and strong environmental, social and governance or ESG practices. The F4GBMS Index tracks the constituents in the F4GBM that are syariah-compliant. 'For the June 2025 review, the F4GBM Index will see 19 additions and five exclusions, bringing its constituent count to 160,' Bursa Malaysia said. Separately, the F4GBMS Index will see 14 inclusions and four exclusions, resulting in a total of 125 constituents in the index. All constituent changes will take effect at the start of business on June 23, 2025. The new additions to the F4GBM Index include Berjaya Land Bhd , Capitaland Malaysia Trust , Carlsberg Brewery Malaysia Bhd , EG Industries Bhd , Genetec Technology Bhd and Genting Plantations Bhd . Meanwhile, IOI Properties Group Bhd , Samaiden Group Bhd, UEM Edgenta Bhd and Malakoff Corp Bhd, among others, have been included in the F4GBMS Index.

JcbNext trims stake in Taiwan listed company
JcbNext trims stake in Taiwan listed company

The Star

time42 minutes ago

  • The Star

JcbNext trims stake in Taiwan listed company

PETALING JAYA: JcbNext Bhd has disposed of 647,846 shares (or 1.95%) in Taiwan-based 104 Corp for RM20.05mil on the open market of the Taiwan Stock Exchange. The company, a provider of interactive online marketing platforms and technologies, said in a Bursa Malaysia filing that the disposal will decrease its shareholding in 104 Corp from 4.47 million shares to 3.82 million shares, representing 11.50% of the issued share capital of 104 Corp of 33.19 million shares. 'The disposals are in line with the company's strategy of diversifying its investment portfolio and reducing concentration risk. 'The company will be able to utilise the disposal consideration to invest in other opportunities such as other listed equity securities or other private investments that meet the company's investment objectives,' it said.

TFC To Cut Cost With Only Four Import Players For 2025/2026 Season
TFC To Cut Cost With Only Four Import Players For 2025/2026 Season

Barnama

time5 hours ago

  • Barnama

TFC To Cut Cost With Only Four Import Players For 2025/2026 Season

KUALA TERENGGANU, June 12 (Bernama) -- Terengganu FC (TFC) will only use a maximum of four import players to face the Malaysia League (M-League) competition in the 2025/2026 season. Terengganu Football Club Sdn Bhd (TFCSB) board of directors member Mohd Fadhli Rahmi Zulkifli stated that this decision was due to the club's financial constraints and to provide more opportunities for local players to play. He said the Kuala Nerus-based club already has a shortlist of potential import players, but further discussions are needed to determine other matters such as the preferred playing positions.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store