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Swissco subsidiary faces statutory demands from Ezion over three co-owned rigs

Swissco subsidiary faces statutory demands from Ezion over three co-owned rigs
Swissco Holdings’ partner in rig ownership, Ezion Investments, has filed statutory demands against its subsidiary Scott and English Energy (S&E) with the possibility of winding up S&E, and Swissco is disputing the claims.

Singapore-listed Swissco said its subsidiary S&E has received three statutory demands from Ezion Investments relating to claims amounting to $522,112.88 arising from various joint ventures entered into between the two firms for the ownership and management of three rigs.

Ezion asserted that it is owed the sums of $236,695.94, %151,335.63, and $134,081.31 being corporate guarantee fees allegedly due from S&E.

Ezion stated that unless the sums are paid within three weeks of the dates of the statutory demands (9 & 10 November), it will be entitled to apply to the court for S&E to be wound up.

“S&E’s position is that the alleged corporate guarantee fees are not due and payable to Ezion,” Swissco said.

“Further and in the alternative, S&E considers that it has counterclaims against Ezion and that these counterclaims outweigh and fully set off any amounts in relation to the alleged corporate guarantee fees that may be due to Ezion (which is denied),” it said.

“The group is in the process of taking further legal advice on Ezion’s claims and S&E’s counterclaims,” Swissco added.

Swissco itself is already in a legal quagmire as it announced earlier this week that it will file for an interim judicial management by next week, after the company failed to receive support from its major lenders.

Swissco owns a fleet of OSVs and seven rigs, of which three are co-owned with Ezion and four are facing threats of judicial sale in an ongoing legal battle with X-Drill Holding. At the same time, Swissco has revealed intentions to scrap these four rigs – two wholly-owned and two 50% owned.

Following the rig scrapping intention and the dispute with X-Drill, Swissco received two letters dated 10 November 2016 from certain holders of redeemable exchangeable preference shares (REPS) in two of the rig-owning companies.

The letters alleged that there has been a breach of terms arising from Swissco’s decision to scrap certain rigs as well as disputes and legal proceedings commenced by X-Drill.

The letters further alleged a “liquidation event” has arisen to which the two rig-owning firms are then required to redeem outstanding REPS at a contractually stipulated price plus a redemption premium of 35% per annum.

Swissco said it is taking legal advice on the matters stated in the letters.

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