Serba Dinamik Group Berhad and its indirect wholly-owned subsidiaries have filed to the High Court of Malaya for its to be placed under judicial management.
SDGB, SDSB, SD Development, and SD Controls had also filed a Notice of Application for the appointment of an interim judicial manager to manage their affairs, businesses, and properties pending the full and final disposal of the JM OS.
The group added, that since May 2021, there has been a series of events that has affected the cash flow due to the Covid-19 pandemic environment which has significantly slowed down the timing of payments by customers as well progress of the projects undertaken by the group. This had in turn led to a high inventory level and the slowing down of the conversion of inventory to cash and cash equivalent, resulting in collection to slow down.
Some of the assets of are longer-term assets that are related to property development and infrastructure development and it will take time to convert such assets into cash.
It claimed the purpose of the JM Proceedings, is to allow Serba Dinamik the opportunities to, rehabilitate the subsidiaries by a combination of several approaches to regularise the financial condition of the group. Generate the cash flow required to meet the liabilities and measures must be put in place to defer the payment obligations within the Serba Group so as to achieve a correction of the asset-liability mismatch that currently exists.
Also possibly to generate the cash flows required which may require the immediate sale of certain long term assets which will achieve better sale value if done under conditions that are not fire sale conditions and restructure the debts owed to their creditors and consequently be in a better position to address the repayment of their debts.
Serba will allow the judicial manager, to stand in a neutral position where confidence can be infused in the creditors while at the same time structuring a rehabilitation proposal that leads to the recovery of the amounts owing to the lenders and creditors.
The Board of Directors of the Company in view that the JM Proceedings are in the best interest of the group.
