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Cash-strapped Nam Cheong to sell corporate office property in Singapore

Malaysia’s Nam Cheong is proceeding to dispose of its corporate office property in Singapore so as to pay off an outstanding amount for the mortgage, in light of the company’s ongoing discussions on a proposed debt restructuring.

The Paya Lebar freehold property in Singapore, currently Nam Cheong’s principal place of business, will be sold to a third party for SGD4.5m ($3.4m). All proceeds from the sale will be applied towards settlement of outstanding amount under a credit facility granted by DBS Bank and secured by the property.

This is the second property disposal by Nam Cheong, as the OSV builder earlier this month sold three Singapore office units that were also on mortgage to DBS Bank.

For the Paya Lebar property, Nam Cheong said it “intends to negotiate for a lease back of the property from the purchase to allow the company to continue using the Paya Lebar property as a corporate office to minimise any disruption to the business of the company.”

Nam Cheong maintained that the Payar Lebar property is a non-operational and non-core asset of the group, and that the disposal will not impact the existing core operations of shipbuilding and chartering businesses.

The embattled company had held a noteholders meeting on 7 September, urging for their support to vote for a scheme of arrangement restructuring rather than a vote down that would lead to a liquidation scenario.

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