Al-Khodari’s creditor filed for financial restructuring under bankruptcy law

Abdullah A. M. Al-Khodari Sons Co. was notified today by Dammam commercial court that one of the firm’s creditors has filed for initiating a financial restructuring under Saudi Arabia’s new bankruptcy law, the firm said in a bourse statement.

The court has set June 12, 2019 to review the creditor’s request.

The financial restructuring procedure aims to facilitate reaching an agreement with creditors under the supervision of a financial restructuring secretary, the company said.

The financial impact resulting from this procedure is hard to predict at the moment, and the firm will reveal updates should any occurs.

Meanwhile, Al-Khodari is going forward with the extraordinary general assembly’s decision on March 13 to restructure capital through a capital hike then a reduction, in order to reduce the accumulated losses below 50 percent, and any related developments will be disclosed, it added.

It is worth mentioning that under the bankruptcy laws, filing for a financial restructuring exempts a company from the due regulations in case of accumulated losses reached 50 percent or more.

According to data compiled by Argaam, the firm said earlier this month that it couldn’t reveal 2018 financials as it’s still fulfilling audit requirements after its accumulated losses accounted for 198.52 percent of capital.

Tadawul placed on April 30 a trading halt on the company’s shares it discloses its fiscal financial statements.