Scandal-hit Stark Corporation is asking for a further delay in submitting its extended-scope special audit report, saying asset seizures by concerned agencies had disrupted the business and its filing to the Bankruptcy Court for capital and debt restructuring.
In a filing to the Stock Exchange of Thailand, the wire and cable maker said seizures of the group's assets meant that the company was not in a position to fully negotiate with creditors and restructure the business.
Under such a situation, it would be difficult for the company to raise capital or consider seeking new investors in order to increase the liquidity, it noted.
As the assets were being seized, which has generated a significant negative impact on the group, Stark has had to dedicate personnel and time to gathering information and documents for the Securities and Exchange Commission (SEC) for the company to carry out necessary transactions and prevent problems arising from the interruption, director Attapol Watjarapairoj said in the filing.
"Therefore, the company is unable to complete the extended-scope special audit by July 17. We thus submit a request for an extension of time to perform the act for a second time until Sept 29," he added.
On Tuesday the SEC said in a statement that it would consider Stark's request to delay the submission of its special audit.
The SEC's order to seize Stark's assets had an impact on the confidence of the company's partners and customers, the recruitment of personnel, including directors and employees in key positions, its ability to manage the business and solve issues of the group, and led to the resignation of skilled workers. Therefore, the group's operations lacked continuity and had led to a significant interruption, Mr Attapol said.
According to Mr Attapol, Stark is in the process of examining its outstanding bank statements, of which about 75% have been reviewed. However, it had difficulty in obtaining statements from some banks, and the documents received did not provide sufficient detail to identify linkages between the payee and payer.
Therefore, the company and the auditor would need to spend a great deal of time examining the information gathered from such documents. Document preparation for affiliates including Phelps Dodge International (Thailand), Adisorn Songkhla Co and Thai Cable International Co have also not been completed yet.
"It is necessary for the company to take any action for the SEC to allow the group to conduct financial transactions, and any activities necessary to continue operating the business normally as soon as possible in order to mitigate the impact on all parties involved," said Mr Attapol.