KUALA LUMPUR: Sapura Energy Bhd, a Practice Note 17 (PN17) company, is in the final stages of completing its restructuring scheme with lenders and trade creditors.
Group chief executive officer Datuk Anuar Taib told the New Straits Times that Sapura Energy expects to wrap up the process by the end of the year.
Sapura Energy's restructuring will also entail a potential financial investment of about RM1.8 billion from a white knight, which according to Anuar will support the group's goal to preserve the industry eco-system.
Anuar also noted that the group had validated RM1.5 billion in claims from about 2,000 vendors through a Proof of Debt exercise involving trade creditors.
To address its PN17 status, he said Sapura Energy had appointed MIDF Amanah Investment Bank Bhd as principal adviser to help formulate a regularisation plan for submission to Bursa Malaysia.
The stock market regulator has granted Sapura Energy an extension of time up to Nov 30 this year to submit the plan to the relevant regulatory authorities.
"We have consistently stated that our aim in the restructuring negotiations is to ensure a fair and equitable solution to all stakeholders, including our lenders, vendors, shareholders and employees.
"We aim to restore the financial health of Sapura Energy by reducing our unsustainable debt, because we believe this is a Malaysian company worth saving. We contribute to the country through taxes, foreign exchange inflows and economic linkages in areas where we operate."
Anuar pointed out that in the last financial year alone, the group had contributed about RM72 million in taxes and RM4.2 billion in contract payments to vendors and suppliers, most of whom are Malaysians.
"We paid more than RM1 billion in wages, where 80 per cent of our talents and skilled workers are Malaysians who are likely to spend their earnings in the country. We have built an arsenal of capabilities and assets that have positioned us as a world-class competitor in the global energy sector."
He stressed that liquidating the company or breaking it up will hurt not just the shareholders and employees, but also the many Malaysian businesses and families who rely on it.
"In the same vein, it is just as important for us to resolve our overdue trade payables to vendors. Our vendors went through the same difficulties as us, with the smaller ones in an even more vulnerable position.
"Resolving our dues to them is just the right thing to do. We understand the importance of preserving the oil and gas eco-system and ensure that they too can survive and thrive in the energy transition."
On the recent audit conducted by Ernst & Young, which highlighted concerns about Sapura Energy's long-term viability as a going concern, Anuar said the finding, which was contained in its 2023 annual report was not new.
"It was also a finding posted in our FY2022 Annual Report. The findings are to be expected under the requirements of Financial Reporting Standards given our status as a PN17 company.
"This is fair, as it provides caution to investors who are thinking of buying our shares. At the same time, I'd like to emphasise that despite our financial constraints, Sapura Energy remains a going concern.
"We have shown encouraging financial results, we continued to win new contracts in Malaysia and internationally, and we have managed a stable cash position. These factors provide a good foundation for us to complete the task at hand, which is to fully implement our Reset Plan and exit the PN17 status."
Anuar reiterated that Sapura Energy aims to restore iots financial health through the debt restructuring exercise; and strengthen operations through its principle of "Bid Right and Execute with Discipline".
"The next step would be to enhance how we acquire and develop technology, talent and funding in the company, to enable us to thrive in the Energy Transition," he said.