RICH defaults, hit by debts

SET-listed Rich Asia Corporation Public Plc (RICH), a maker and distributor of steel pipes, has defaulted on 805.9 million baht in debt owed to a bank and is struggling to pay debts due within the next few months, leading the company to seek talks with creditors as well as restructure its financial operation in order to repay all debts.

Managing director Somkiat Vongsarojana said the first tranche of defaulted debt of 805.9 million baht comprised 537.7 million in principal and 268.1 million in interest owed to a bank, which the company declined to name.

The debt was due at the end of October 2016.

Mr Somkiat said the company's board of directors met last week and agreed to allow the executives to enter the financial restructuring plan, pursue talks with creditors as well apply some legal process that would be needed in order to help the company to repay the defaulted debt.

He said the company appointed Phoenix Advisory Services Co Ltd as financial adviser and legal counsellor to resolve the company's debt.

"The company expects to inform on progress regarding financial restructuring and debt management to the Stock Exchange of Thailand by March 31," Mr Somkiat said in a press release.

Furthermore, RICH also defaulted on other tranches of bills of exchange (B/Es) and debentures owed to several investors worth a combined 1.25 billion baht, overdue since last week.

The total overdue debts were 1.05 billion baht of debentures owed to investors and another 20 million baht worth of B/Es owed to one investor.

Moreover, RICH still has B/Es worth 105 million baht in total owed by five small investors that are due between February and April.

But the company has not yet provided a plan to pay the 105 million baht of B/E debts.

RICH posted a net loss of 36.2 million baht in the third quarter of 2016, smaller than the net loss of 66 million in the same period of last year.

The company listed on the SET in 2006, when it launched a 100-million-baht initial public offering at 2.25 baht a share.

RICH shares closed yesterday on the SET at 22 satang, down six satang, in trade worth 59 million baht.