Kuwait’s Global Investment House will ask shareholders to approve delisting its shares from the bourse after failing to secure a regulatory waiver needed to implement its restructuring plan, it said on Monday.
Shareholders will meet on December 2 to discuss the move, according to a Global statement. The firm’s shares have not traded in Kuwait since last December, when the bourse suspended the stock after Global accumulated losses exceeding 75 per cent of its capital.
Global shareholders in September approved a debt-for-equity style plan to create new special purpose vehicles that will carry the company’s debt. Under the plan, Global will offer new shares worth 122.2 million dinars ($433 million) to creditors.
However, Global said on Monday it had been unable to get an exemption to rules requiring it to allow existing shareholders to take part in any new equity offering.
“Global would like to assure its shareholders that the implementation of the restructuring plan is dependent on the exemption granted by the Capital Markets Authority from the mandatory offer rules to the special purpose vehicle that shall subscribe to Global’s capital increase,” the statement said.
Global, whose major shareholders include the governments of Kuwait and Dubai, is undergoing a second restructuring in three years after the company asked creditors in September 2011 to suspend payments under a $1.7 billion debt plan agreed in 2009.
The company said last week that while it had secured 95 per cent assent from lenders for the new plan, three creditors had failed to back it. Global said it would pursue all options, including legal remedy, to force errant creditors into line.
Debt restructurings in Kuwait have to secure unanimous backing from creditors unless the negotiations are covered by the country’s Financial Stability Law, which contains provisions to sidestep dissenters if a vast majority agree to a proposal.
Global has not applied to have the law cover its debt talks. The law, introduced after the 2008 financial crisis, has only been used once – by Investment Dar, owner of luxury car maker Aston Martin, to secure a 1 billion dinar debt deal in 2011.
Global’s shares are also listed in Dubai, Bahrain and London; the latter through global depositary receipts.