KUALA LUMPUR (April 2): Scomi Energy Services Bhd (SESB) and its subsidiaries, which have been served with winding up petitions, today applied for a judicial management (JM) order at the High Court.

“The application for the JM order immediately puts into effect a moratorium for the period commencing with the application of the JM order and ending with the grant or dismissal of the application,” SESB said in a statement filed with Bursa Malaysia.

During the period, no resolution can be passed or order made for the winding-up of SESB and its subsidiaries, the statement said.

The subsidiaries are Scomi Oiltools Sdn Bhd, Scomi KMC Sdn Bhd and KMCOB Capital Bhd.

SESB said during this moratorium, the court will also not be able to enforce any charge on, or security over, the property of SESB or its subsidiaries.

Also, legal proceeding cannot be commenced or continued against the entities or their respective property.

This will effectively prevent the entities from being wound-up or sold at distressed values, SESB said.

The group added that the JM order also served to provide some time for the entities to restructure their debts, and secure the expertise of an independent professional to assist them with the rehabilitation of their debts and assist them to better realise their assets.

Besides that, the JM order will also allow the entities to continue operating and deliver ongoing contracts and tenders across the world, thereby preserving the business and providing opportunity to generate returns and cash flow to meet their borrowing and creditor obligations.

On March 12, KMCOB Capital had defaulted on a loan payment amounting to RM80.41 million, following which Hong Leong Investment Bank Bhd issued a notice to KMCOB, declaring an event of default.

Share of SESB closed up 2 sen or 50% to 6 sen today, valuing the group at RM28 million.