Ecobuilt Holdings Bhd said a creditor of its wholly owned subsidiary, Rexallent Construction Sdn Bhd, has filed a court application for a proposed scheme of arrangement to restructure and settle amounts owed to creditors.
The application was filed on Sept 18 by Maxi Steel & Aluminium Industries Sdn Bhd at the Shah Alam High Court under Section 366 of the Companies Act 2016.
Maxi Steel also applied for a restraining order under Section 368, triggering an automatic moratorium upon filing.
Under the moratorium, no winding-up order may be made against Rexallent, no receiver or receiver and manager may be appointed over its assets, and legal proceedings against the company generally cannot be commenced or continued without leave of the court.
The moratorium also restricts enforcement action against Rexallent’s property, including execution proceedings, enforcement of security interests and repossession of assets, unless permitted by the court.
The protection will remain in effect for up to two months from the filing date or until the court rules on the restraining order application, whichever is earlier.
Ecobuilt said the proposed scheme was initiated by Maxi Steel as a creditor of Rexallent and is intended to facilitate the restructuring and settlement of amounts owing by the subsidiary to its creditors.
The company said the moratorium is not expected to have any material adverse financial or operational impact on the group.
It added that Rexallent and the wider Ecobuilt group are able to continue their day-to-day operations as usual during the moratorium period.
Ecobuilt said the temporary protection could also help reduce potential disruption arising from legal proceedings while the court considers the restraining order and the proposed scheme progresses.
