Koon Holdings to wind up precast division

Singapore

KOON Holdings on Tuesday said it has decided to wind up its precast division, so as not to jeopardise the group's ongoing restructuring.

The division, which specialises in the precasting of concrete structures, includes Econ Precast Pte Ltd, Econ Precast Sdn Bhd, Contech Precast Pte Ltd, Bukit Intan Pte Ltd, Sindo-Econ Pte Ltd and PT Sindomas Precas.

"Due to aggressive bidding among competitors and operating challenges faced, some of these precast division companies have been suffering losses," Koon Holdings said.

Some of the precast division companies are also facing claims made by creditors, and have had to address legal proceedings commenced against them by creditors. Koon Holdings had studied the viability of having them defend or settle the legal proceedings in the Singapore courts, but has since decided to begin the voluntary winding-up proceedings for the division. Koon Holdings also highlighted that Contech Precast is the subject of a compulsory winding-up application initiated by the CBE Group in the Singapore courts.

In a separate bourse filing on Tuesday, Koon Holdings said it completed the disposal of its 74.06 per cent stake in Australian energy infrastructure company Tesla Holdings Pty Ltd for about A$8.9 million (S$8.6 million). Tesla Holdings owns and operates four diesel power generation plants in Western Australia.

The disposal was required under the terms of one of the two schemes of arrangement. According to the scheme, Koon Holdings must dispose of its interests in the Australian firm, so that it can use the net proceeds to make a cash distribution to participating creditors with Class A and Class B claims. Koon Holdings and the group's main operating company had proposed their respective schemes of arrangement as part of the group's debt restructuring exercise, and the Singapore High Court on June 23 approved both schemes. The schemes subsequently commenced from June 26. Shares of Koon Holdings have been suspended since Aug 30.