SINGAPORE-BASED nTan Corporate Advisory has tied up with Jakarta-based AJCapital Advisory to form an alliance that will specialise in corporate restructurings, known as 9 Capital.
The move comes just days after Indonesian garment manufacturer Pan Brothers hired nTan Corporate Advisory as a financial adviser after it ran into financial challenges, prompting creditors to call for a potential court-supervised insolvency process.
With AJCapital now in partnership with nTan Corporate Advisory, their newly formed 9 Capital alliance will be the financial adviser to Pan Brothers in respect of the restructuring of its debts and operations, said Nicky Tan, founder of nTan Corporate Advisory.
“9 Capital combines AJCapital’s and nTan Corporate Advisory’s deep cross-border expertise and experience in special situation transactions and complex corporate restructurings,” Tan told The Straits Times.
“The alliance is working to bring together prominent, experienced and renowned advisers from the Asean plus China region.”
Tan is well known in the Singapore corporate scene, having been involved in some of the most high-profile and contentious restructurings in Singapore and the Asean region since the 1998 financial crisis when he was chairman of PriceWaterhouseCooper’s financial advisory services for the Asia Pacific region.
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These included Amcol’s S$1.5 billion debt restructuring completed in 1996, Asia Pulp & Paper’s US$12 billion debt restructuring completed in 2005, and Hyflux, which was ordered to liquidate in July 2021, some three years after it sought to restructure its debts.
Tan was also appointed by the then minister for finance to investigate into the collapse of Barings Bank in 1995.
As Debtwire reported, Tan’s involvement with Pan Brothers raises the likelihood that the company will pursue another Singapore scheme of arrangement, as the Indonesian garment maker did in 2022.
Pan Brothers completed a restructuring via a pre-packaged Singapore scheme of arrangement, which was sanctioned by the Singapore High Court on Jan 17, 2022. The US Bankruptcy Court for the Southern District of New York on March 9 of the same year granted a Chapter 15 recognition of the Singapore process.
The Indonesian garment manufacturer is in technical default on its debt after missing amortisation and interest payments on its revolving credit facility. Pan Brothers has debts totalling some S$500 million owed to about 10 banks and bondholders.
The company also failed to pay its Jan 26 coupon on its US$171 million (S$230 million) 7.625 per cent bonds due December 2025. The bonds are traded in Singapore.
Debtwire reported last week that Pan Brothers had appointed AJCapital to undertake the restructuring for a PKPU insolvency process after it and three of its subsidiaries were hit by a petition in May by trade creditor Januardi Putera Logistik, which sought an order from the Central Jakarta Commercial Court.
PKPU is the only formal restructuring process in Indonesia. It is a debtor-in-possession restructuring process (like the US Chapter 11 process, or Singapore’s scheme of arrangement process) whereby the debtor company retains control over the management of the debtor’s property and assets.
It was also reported that Maybank Indonesia and Pan Brothers have yet to resolve an impasse regarding the bank’s refusal to extend the garment maker’s syndicated secured revolving credit facility with US$123.5 million principal outstanding.
Baker McKenzie Wong & Leow is Pan Brothers’ counsel on Singapore and international law matters. THE STRAITS TIMES
