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Viking Offshore enters term sheet to raise S$5m from proposed placement

DISTRESSED Viking Offshore and Marine (VOM) has entered a term sheet with two parties to raise S$5 million in gross cash proceeds by placing out 66.5 per cent of its enlarged share base, after issuing new shares to creditors. 

In a bourse filing on Saturday, VOM said that it has entered a binding conditional term sheet for Ruddin Advisory to subscribe to 53 per cent of VOM's enlarged share base for S$4 million, and for Blue Ocean Capital Partners to subscribe to a 13.5 per cent stake for S$1 million. 

The enlarged share base takes into account new shares to be issued to creditors as part of the Catalist-listed company's planned scheme of arrangement, which has yet to be finalised. VOM is currently under court protection from creditors as it restructures its liabilities. 

Ruddin Advisory is a Hong Kong-based business advisory that serves corporations, governments and high-net-worth individuals. None of its directors or shareholders are related to VOM. 

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Meanwhile, Singapore-based corporate consultancy Blue Ocean counts Daniel Lin Wei, the son of VOM executive chairman Andy Lim, as its executive director and sole shareholder. This makes the proposed placement to Blue Ocean an interested-party transaction under listing rules. 

VOM intends to use the placement proceeds to repay debts to creditors under the scheme of arrangement, pay professional fees related to its restructuring and to fund working capital. 

The term sheet provides an exclusivity period of 30 days for the parties to negotiate and finalise the terms of a definitive agreement, to be signed by Jan 13, 2020. The proposed placement, as well as new shares to be issued as part of the scheme of arrangement, will be subject to approval of shareholders at an extraordinary general meeting. 

Shares of VOM have been suspended from trading since June. They last closed at S$0.004.