Ezion Holdings

[tonylim]

Getting worst or better ?

GENERAL BUSINESS UPDATES AND PROFIT GUIDANCE FOR THE GROUP’S UNAUDITED FINANCIAL RESULTS FOR THE FOURTH QUARTER AND TWELVE MONTHS ENDED 31 DECEMBER 2018


https://links.sgx.com/FileOpen/Ezion_Ann...eID=542679

[CY09]

I am very curious to how the optimistic Mr Chew keeps pushing back the expected deployment of lifeboats. The expected timeline of full deployment is now end 2019, from the previous timeline of end 2018 which was said in Oct 2017.

Revenue wise, it only improved by a 20%. What has baffled me is how the company is still facing working capital constraints by citing that the secured bank financing is not finalised,  despite the company announcing it has been agreed on 2 July 2018 and even paying the banks in shares already for the refinancing.

If shareholders can sue anyone for not meeting their timeline, i think Ezion is a prime candidate to make money from Mr chew

This is something that baffles me. The banks have taken the consent fee in July 2018 but yet are not finalising the paper works. It is particularly worrying that one can prepay and then do not complete the restructuring for a long time.

In my opinion, this has affected my trust in both Ezion management and the banks in their credibility of holding onto their words. Given this, it is likely the full deployment of its liftboats will move onwards till 2020 instead of end 2019. This will greatly affect the profitability of the company as its loses 1 year of useful life of its fleet

I am very curious to how the optimistic Mr Chew keeps pushing back the expected deployment of lifeboats. The expected timeline of full deployment is now end 2019, from the previous timeline of end 2018 which was said in Oct 2017.

Revenue wise, it only improved by a 20%. What has baffled me is how the company is still facing working capital constraints by citing that the secured bank financing is not finalised,  despite the company announcing it has been agreed on 2 July 2018 and even paying the banks in shares already for the refinancing.

If shareholders can sue anyone for not meeting their timeline, i think Ezion is a prime candidate to make money from Mr chew

Hi CY09 ,  The company is still facing working capital constraints could be due to this reason , which the management had mentioned in their 3Q results ???

'''' Updates on Refinancing Exercise
On 3 July 2018, the Group had entered into loan agreements with all the secured lenders pursuant to the refinancing exercise. Upon the execution of the security documents in relation to the loan agreements for all the secured lenders which is expected to be completed by end of 2018, the refinancing exercise would be deemed completed. "" "

[tonylim]

Request for trading halt ! Just to announce 4Q result ?

[CY09]

https://links.sgx.com/FileOpen/Ezion_Let...eID=545927

Ezion announced its full year results which recorded another round of impairments which is equivalent to its previous round of impairments during the refinancing exercise, which presumably should have been the final round of impairment.

But what is more impactful is the letter to shareholders from the CEO. In his letter he wrote, "Ezion is in advanced discussions with a potential strategic investor. The potential strategic investor need also to agree terms with the secured lenders." Secondly, it is known that secured lenders have not been granting Ezion its working capitals despite having been paid the consent fee and the fact they had signed binding agreements in February 2018.


All these are circumstantial evidence which points to the fact that Ezion's refinancing has in fact not yet been completed. The company should not have been allowed to be un suspended because the company's going concern is still at stake; it is quite apparent the terms agreed with the secured lenders have not been finalised

[AQ.]

Looking @ what's happening to Ezion, Falcon, and OCBC's conservative stance on O&G, it looks like hopes for a bottoming of O&G is not panning out. It even feels like it's taking a dump lower.

I suppose having a US President explicitly forcing low oil prices is not helping.

[weijian]

Looking @ what's happening to Ezion, Falcon, and OCBC's conservative stance on O&G, it looks like hopes for a bottoming of O&G is not panning out. It even feels like it's taking a dump lower.

I suppose having a US President explicitly forcing low oil prices is not helping.

The BDI bottomed in early 2016, while the announcement of NOL accqusition by CMA-CGM came in Dec2015. Of course, NOL been a big player could have played some sort of effect on the bottoming out of the BDI then.

Ignoring the impact of NOL on BDI, i would like to believe there is a stronger BDI's impact on NOL's decision making because generally, the markets will capitulate the players before bottoming out. Although the Korean rig builders have merged, but the Singaporean players are still hanging out (but maybe not for long). Probably a sign that the suffering for the upstream O&G players will be ending, would be the merging of the Singapore rig builders?

[AQ.]

For the past 3yrs, Sam Tsien (OCBC CEO) has been consistently saying that he does not see a recovery for the OSVs unless oil >60 consistently.

This is significant not cos he is a gr8 forecaster, but cos he is OCBC's CEO i.e. banks will not lend for oil<60.

Brent bottomed out ~30 in 2016, spent 2017 in 50s, broke 60 in 2018 and hit 85 on 1Oct18. Analysts called for $200 oil.
2nd Oct - Jamal Kashoggi got murdered and oil fell back to 50s and is hovering ~60s now.

For until Trump shuts up and OPEC acts led by Saudis, oil will find it hard to rally, and thus banks will not lend. Unless O&G players intend to fund capex, working capital etc solely out of equity, demand will not pickup. i.e. it all boils down to oil price.

I suspect the consortium of banks were willing to refi Ezion in 2017-2018 thinking oil bottomed and perhaps thinking state support, but now reluctant since oil collapsed and Temasek ended up being flippers i/o patient $.

Good ol' addage - banks lend umbrella when sun shining and withdraw when starts to rain.

[CY09]

Hi AQ,

I do share your view on this matter. It does seems the banks are not willing to finance Ezion under the current state. This is because in July 2018, the banks has in fact taken payment a consent fee to accept the deal; but the deal is not completed yet which shows banks are having some form of buyer remorse.

In addition Pavilion Capital had bought UOB's stake in marco polo marine, this appeared in the news. However a quick check in Marco Polo Marine AR does not show Pavilion Capital as a top 20 shareholder with the corresponding stake has probably spooked banks. Banks maybe realised that Temasek and the government is not acting as a backstop to the oil/Gas crisis but are just trying to profit from it.

I too am aware the Pavilion has bought a stake in Ezion which would have placed in the top 20 with a 4.43% stake. I am willing to bet in Ezion's latest annual report, Pavilion would have a much lower stake

[tonylim]

Hi AQ,

I do share your view on this matter. It does seems the banks are not willing to finance Ezion under the current state. This is because in July 2018, the banks has in fact taken payment a consent fee to accept the deal; but the deal is not completed yet which shows banks are having some form of buyer remorse.

In addition Pavilion Capital had bought UOB's stake in marco polo marine, this appeared in the news. However a quick check in Marco Polo Marine AR does not show Pavilion Capital as a top 20 shareholder with the corresponding stake has probably spooked banks. Banks maybe realised that Temasek and the government is not acting as a backstop to the oil/Gas crisis but are just trying to profit from it.

I too am aware the Pavilion has bought a stake in Ezion which would have placed in the top 20 with a 4.43% stake. I am willing to bet in Ezion's latest annual report, Pavilion would have a much lower stake

https://www.straitstimes.com/business/co...m-in-ezion


Offshore and marine (O&M) group Ezion Holdings could raise up to $50 million through a placement of shares and options to its first strategic investor in this prolonged industry downturn.
Temasek-linked Pavilion Capital Fund Holdings (Pavilion) agreed on Wednesday to take a 4.43 per cent stake in Ezion by buying 96.2 million shares at 20.8 cents apiece, or $20 million in total, through a share placement.
Pavilion will also receive, for a nominal sum of $1, 137.6 million options that may be converted into Ezion shares at 21.8 cents a share. If the options are fully exercised, Ezion will get an additional $30 million in gross proceeds. This will raise Pavilion's stake to 10.13 per cent of Ezion's enlarged share capital. Net proceeds from the options, if fully exercised, will be about $29.4 million.

[tonylim]

https://links.sgx.com/FileOpen/Ezion_Ann...eID=549490


THE PROPOSED ISSUE OF UP TO APPROXIMATELY 22,573,570,9091 NEW ORDINARY SHARES IN THE CAPITAL OF EZION HOLDINGS LIMITED AND THE PROPOSED GRANT OF 3,360,495,867 OPTIONS TO SUBSCRIBE FOR NEW ORDINARY SHARES IN THE CAPITAL OF EZION HOLDINGS LIMITED


a conditional debt conversion agreement with the Subscriber (the “Conditional Debt Conversion Agreement”) to capitalise all of the Relevant Debt (being an amount up to US$916,000,000, as may be so acquired by the Subscriber pursuant to the Debt Assignment Agreements to be entered into) owed by the Company and/or the relevant Group Company to the Subscriber via the allotment and issue of up to approximately


22,573,570,909 new ordinary shares in the capital of the Company (the “Shares”) (the “Subscription Shares”) to the Subscriber and/or to such other entities as the Subscriber may direct at an issue price of S$0.055 per Subscription Share, with fractional entitlements to be disregarded (the “Proposed Subscription”). Following the capitalisation of all of the Relevant Debt via the completion of the allotment and issue of such Subscription Shares by the Company to the Subscriber, the relevant Group Companies shall be deemed to have repaid all of the Relevant Debt to the Subscriber and the Subscriber shall fully release and discharge the relevant Group Companies from their payment obligations of such Relevant Debt; and