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Pacific Radiance says it might not recover US$10.1m from Swiber (Amended)
PACIFIC Radiance estimates that it might not be able to recover about US$10.1 million due to the services rendered to Swiber's subsidiaries, adding that it had served letters of demand to Swiber.
This makes Pacific Radiance another company to be hit by offshore and gas company Swiber's surprise winding-up announcement on Thursday.
Swiber has been placed into provisional liquidation, and its winding-up application will be heard in court on Aug 19.
On Friday, mainboard-listed Pacific Radiance said: "As a number of Swiber's related entities are debtors of the company's subsidiaries, the company is expected to make a provision of doubtful receivables of approximately US$10.1 million in respect of services to Swiber's related entities."
Even before Swiber made its winding-up announcement on Thursday, Pacific Radiance said that it had made efforts to recover some of this money that was owed to it by Swiber. Swiber had said on Thursday that it was facing letters of demand totalling about US$25.9 million as at July 26.
Said Pacific Radiance: "The company also wishes to inform that it had previously served several letters of demand to recover some of Swiber's related entities for recovery of the doubtful receivables, and will continue to pursue all legal avenues of recovery."
It added: "The provision of doubtful receivables is expected to negatively impact the net tangible assets and earnings per share of the company for the financial year ending Dec 31, 2016."
Pacific Radiance is the latest company to be hit by Swiber's announcement amid fears of spreading contagion.
Pacific Radiance, which has a market capitalisation of about S$142.8 million as of July 29, saw its counter continue its fall on Friday.
It closed 4.55 per cent, or one Singapore cent lower at 21 cents apiece. On Thursday, it slid down two cents at 22 cents.
Singaporean banks also took a hit from Swiber's wind-up call. DBS said that it has about S$700 million exposed to Swiber, while UOB said the amount it has exposed is manageable. OCBC is not exposed to it.
Shares of DBS fell 2.9 per cent on Friday to S$15.41. UOB fell 2.7 per cent to S$18.20. OCBC was down 2.3 per cent to S$8.60.
Amendment: An earlier version of the article above said that Pacific Radiance could not recover the amount that was lent to Swiber. This is incorrect. The amount was due to services rendered to Swiber. The article has been edited to reflect this.