Perwaja’s senior management takes 75% pay cut as it restructures debts
Debt-laden Perwaja Holdings Bhd’s senior management has taken a 75% pay cut to align their interests alongside stakeholders to show their commitment towards the turnaround of the company.
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The Malaysian steelmaker made the announcement in a filing late on Friday September 27 to Bursa Malaysia, the country’s stock exchange.
The company said the government’s Corporate Debt Restructuring Committee (CDRC) has approved its application for assistance in the negotiations with its lenders, subject to certain conditions.
Among them, Perwaja is required to submit a proposed restructuring scheme within 60 days from September 26.
Also, the proposed restructuring scheme must comply with CDRC’s restructuring principles.
CDRC is a pre-emptive measure established by Malaysia’s Central Bank to allow corporate borrowers and creditors to work out debt resolutions without having the need to resort to legal proceedings.
Perwaja said the proposed restructuring will allow it to continue operations and complete the turnaround of the company while servicing its debt obligations.
“With the proposed restructuring, Perwaja will be able to support the local steel industry and continue to provide employment for its employees and the dependents amounting to over 15,000 people,” it said.
The company is also banking on its concentration and pelletizing plants – which are currently being constructed in Kemaman, Terengganu – to help in the turnaround.
Besides actively engaging its lenders and trade creditors, Perwaja said its board is also working with trade representatives and the government to address the problem of imported raw materials and finished products being dumped into the country and to prevent the export of essential raw materials.
Perwaja is an upstream steel product manufacturer, and ranks among Malaysia’s largest integrated producers of primary steel products. It has production facilities capable of producing up to 1.5 million tonnes of direct-reduced iron and 1.3 million tonnes of semi-finished steel such as billet and bloom.