SINGAPORE - The controlling shareholder of listed offshore and marine engineering company Kim Heng has lent his company $7 million to fund suitable business opportunities and the group’s working capital needs.
Its executive chairman and chief executive officer Thomas Tan, who controls 40.28 per cent of the company, has extended the loan facility at an interest rate of 8.5 per cent per annum, Kim Heng said in a filing on Monday evening with the Singapore Exchange.
Under the terms of the loan, the company may submit one or more drawdown notices to Mr Tan on any business day before Sept 30. Any amount drawn from the facility will have to be repaid within two years from the disbursement date.
The loan constitutes an interested person transaction (IPT) under SGX listing rules as Mr Tan is a director, CEO and controlling shareholder of the company.
Based on the listing rules, the value of the IPT is based on the interest payable on the borrowing. This means that the company’s IPT would amount to $636,000 assuming that the entire sum has been borrowed, or less than 1 per cent of the company’s latest audited net tangible assets (NTA) of $63.55 million.
Over the past year, Kim Heng has clinched a slew of new offshore engineering contracts, mainly in energy related projects across East Asia.
Just a week ago, it announced it had secured a directional drilling work for optical submarine installation from Alcatel Submarine Networks. In August it entered a two year memorandum of understanding with Dyna-Mac Holdings to embark on larger floating production storage and offloading modules.
Shares of Kim Heng closed unchanged at 8.8 cents on Monday.