Swiber enters deal to sell International Business Park property

Singapore dollar billsSingapore dollar bills

Swiber Holdings‘ wholly owned subsidiary Swiber Corporate Pte. Ltd. (SCPL) has entered into a non-binding memorandum of understanding (MOU) with an independent third party to sell its property at 12 International Business Park in Singapore for S$30.8 million in cash, the company said in a filing to SGX Tuesday. 

The property, which is currently used as Swiber’s headquarters, is a five-storey business park development, with a remaining lease of 34 years, the filing said, noting the property is mortgaged in favor of DBS Bank.

The proceeds of the disposal will be used toward partial repayment of amounts owed to DBS, the filing said.

“Given that the company is currently placed under judicial management and SCPL is currently undergoing a creditors’ voluntary liquidation, the company is of the view that the proposed disposal is in the interest of and will benefit SCPL and the company,” Swiber said. 

Using the proceeds to partially repay DBS would reduce liabilities and interest costs, Swiber said.

In addition, the property is underutilised, with a significant area vacant since September 2017, as only one storey out of five is occupied by Swiber as its headquarters, the filing said.

“The continued under-utilisation of the property has resulted in and will continue to result in substantially more costs incurred for the upkeep and maintenance of the Property, including compliance, utilities and security expenses,” Swiber said. 

Swiber added that the property has no income potential due to oversupply of rental premises in International Business Park, with past efforts to secure new tenants generally unsuccessful.