BANGKOK Dec 15 Thailand's Central Bankruptcy
Court has approved a business plan for Sahaviriya Steel
Industries Pcl (SSI), Thailand's biggest steel maker,
to restructure debts worth 69.2 billion baht ($1.94 billion).
The court cleared SSI to implement the restructuring plan
after some 91.90 percent of its creditors voted in favour in
September, SSI said in a statement on Thursday.
Progress on restructuring SSI's debt will be positive for
the Thai banking sector as bank creditors will be able to reduce
reserves related to SSI loans.
The Thai banking sector's bad debt rose last year after
money lent to SSI and its UK subsidiary was classified as
non-performing loans (NPLs), requiring lenders to set aside
special loan loss provisions.
SSI UK went into liquidation in October 2015 after
mothballing its Redcar plant in northeast England and cutting
Krung Thai Bank, Siam Commercial Bank and
Tisco Bank are three major creditors to report a
surge in provisions after loans to SSI and its British unit
turned into NPLs in the third quarter last year.
The total debt claim was 69.22 billion baht, including 5.3
billion baht interest, and the plan involved debt-to-equity
conversions and debt repayment to 13 groups of creditors, it
Under the plan, SSI will reduce its registered capital to
1.1 billion baht from 32 billion baht and then issue 10 billion
new shares to some groups of creditors to convert debt into
equity at 0.05 baht per a share.
This will raise its registered capital to 11.1 billion baht.
SSI shares were suspended from trading after the company
entered a restructuring process and they last closed at 0.05
baht on April 26.
($1 = 35.7700 baht)
(Reporting by Khettiya Jittapong; Editing by Keith Weir)