Two Saudi-based contracting companies, Eastern Trading and Contracting Company and Eastern Precast Concrete Company, are financially restructuring, with $320 million (SAR 1.2 billion) of debt across seven local banks and more than 2,400 creditors, according to Deloitte, which successfully advised on the proceedings through its KSA bankruptcy team.
The transaction comprised a combination of restructuring solutions, including debt to equity conversion, cash injection, asset disposal plan, debt write-off and debt rescheduling.
“Our streak of successful restructuring under the Financial Reorganisation Procedure is a testament of our capabilities and deep understanding of the KSA bankruptcy law. The law has proven to offer a robust platform for corporates to implement successful restructurings under the supervision of bankruptcy trustees,” said Karim Labban, partner and head of Deloitte Middle East’s Turnaround & Restructuring team in Saudi Arabia. Waleed Sobahi, Audit Partner at Deloitte in Saudi Arabia acted as the bankruptcy trustee of the procedure.
Deloitte’s Turnaround & Restructuring team has advised on five Financial Restructuring procedures since the introduction of the KSA bankruptcy law in late 2018, with over $2.7 billion (SAR 10 billion) of debt across these transactions.
Eastern Trading and Contracting Company was established in 1971 and has a current project portfolio of $346 million (SAR 1.3 billion) across construction, building, engineering, and real estate segments with prominent Saudi government and semi-governmental entities.
Eastern Precast Concrete was established in 2008, offering precast concrete solutions to various types of structures. EPC has established its name in the market by working on several governmental projects in the country.
On 6 March 2022, both companies received majority approval from their respective creditor groups.
