Hot stock update: Vallianz collapses as Swiber's woes send fresh jitters in oil and gas sector

THE share price of Vallianz Holdings collapsed on Thursday morning, following shocking news that its controlling shareholder Swiber Holdings has filed to wind up and is under provisional liquidation.

After hitting S$0.016 a share, Vallianz was trading around S$0.02 a share at 10:18am, down 1.6 Singapore cents, or more than 44 per cent. It eventually closed 41.7 per cent or 1.5 Singapore cents lower at S$0.021. More than 307.6 million shares changed hands, making it the most actively traded stock on the Singapore Exchange. The unusual price and volume prompted a query from the exchange.

On Wednesday, Vallianz announced that its non-executive director and chairman, Raymond Kim Goh, 48, has resigned due to "health reasons". Mr Goh is also the executive chairman and founder of Swiber Holdings.

The resignation was followed by a shocking announcement early Thursday by Swiber, which said that it has filed an application to place the company under provisional liquidation. The winding-up application will be heard in court on Aug 19.

Swiber - once a darling in the Singapore oil and gas sector - also said its executive director and vice chairman Francis Wong, executive director and chief financial officer Leonard Tay and executive director Nitish Gupta have all resigned "to seek new opportunities".

This comes at a time when the company is facing letters of demand for about US$25.9 million in total, and is seeking legal advice.

On Monday, the company said it was facing just US$15.2 million in outstanding demand letters for which legal proceedings had not commenced, and US$4.76 million of outstanding demand letters that had not been paid off.

Shares of Swiber have been halted from trading since July 27. At the time of the halt, the shares were trading around S$0.109 each, down 0.2 Singapore cent, or 1.80 per cent.