Scomi shares fall as subsidiaries go into judicial management

KUALA LUMPUR: Shares of Scomi Group Bhd fell in early trade Monday after three of its subsidiaries applied for judicial management from the Shah Alam High Court as part of its financial restructuring.

The counter fell 10%, or 0.5 sen to 4.5 sen with thin volume.

The three companies that applied for judicial management are Scomi Engineering Bhd, Scomi Rail Bhd and Scomi Transit Project Brazil (Sao Paulo) Sdn Bhd.

The restructuring is meant to place the company on a strong footing.

“Judicial management is a corporate rescue mechanism pursuant to Companies Act 2016 that provides a rehabilitation framework to give companies which are in financial distress an opportunity to be rehabilitated.

“It will temporarily shield the companies from legal proceedings by third parties while the companies are undergoing such rehabilitative measures,” Scomi Group said.

The group recorded a net loss of RM27.91mil in its second quarter ended Sept 30, 2018. For its year to date, it recorded a net loss of RM53.52mil.