Kuwait Pipe Industries and Oil Services Company (KPIOS) signed on an agreement Saturday to settle its commercial debt with creditors, totaling around KD 130 million (USD 445 million), a comprehensive move that would permanently stabilize its capital structure.
The signing which took place after the company's shareholders approval will also enable the company to be debt-free and 80 percent owned by the creditors who are also partners in the company, the Global Investment House (Global), the financial advisor to KPIOS, said in a press release.
The statement said the deal includes the acquisition by participating creditors to the company's investment portfolio assets, which are ensured with a total of KD 12 million, and creditors will also be participating in the company's capital through subscription of capital increase.
The statement noted, in return the debt of about KD 90 million will be rewritten and the remaining commercial debt will be written off, adding that the deal is expected to be implemented during the second quarter of 2015.
For his part, KPIOS Board of Directors and Chairman of the restructuring of the company Abdulkareem Al-Mutawa said that commercial debt settlement paves the way for the company "to focus on our core business and growth.
"We expect to complete the establishment of a new pipeline which will increase the current capacity to 100,000 tons," Al-Mutawa added.