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Heavily indebted Serrano finds potential investor; board says group able to continue operating as going concern
HEAVILY indebted interior designer firm Serrano Limited has received interest from a potential investor to plough S$8 million into the company, potentially bringing relief for its debt restructuring efforts.
The potential investor had written a confirmation of interest to Serrano on Tuesday to subscribe for new ordinary shares in the firm, Serrano said in an exchange filing on Wednesday evening. The proceeds will go towards partial cash repayment to unsecured creditors and also for its working capital purposes.
The firm also said in the announcement that its board believes the group will be able to continue operating as a going concern, though this depends on approval from the court, creditors and/or shareholders for a proposed resolution to the debts.
The terms of the proposed investment have been put forth to the major creditors of the company, and it has not received any objection from them to proceed with the submission of an application to the court to convene a scheme creditors' meeting, it added.
"The board understands that the major creditors of the company and Serrano Holdings remain generally open to continue discussions to formulate a proposed settlement plan under a scheme," it said.
Serrano, which listed in 2014, has been facing numerous letters of demands from its creditors. In April, it received a letter of demand from lawyers acting for United Overseas Bank (UOB), claiming the repayment of a principal sum of S$21 million, in respect of banking facilities granted to Serrano for residential, hospitality, retail and commercial sectors.
Last week, a subsidiary received a writ of summons from wood supplier Maxcon Enterprise claiming a sum of some S$715,000.
The group said if its ability to continue to operate as a going concern were to be put into doubt by any future developments, it will request for a suspension of trading in its shares.