Among others, the exercise include the transfer by Twin Rivers Technologies Holdings Inc (TRT Holdings) of its 100% equity in Twin Rivers Technologies Holdings Entreprises de Transformation de Graines Oléagineuses du Québec Inc (TRT Holdings ETGO Inc) to Felda Global Ventures North America Sdn Bhd (FGV North America) for C$1.00.
It will also involve the merger of Twin Rivers Technologies US Inc (TRT US) with and into TRT Holdings, said CIMB and Maybank Investment Bank on behalf of FGVH in a filing with Bursa Malaysia.
Upon completion of the merger, the shareholdings of FGV North America in TRT Holdings, representing 117,646 Class A Common Stock shares and 80,000 Class B common stock will be converted to a single class common stock only.
Another move will be the forgiveness and cancellation of debt by FGV North America to Felda Global Ventures North America US LLC (FGV US LLC) and by FGV US LLC to TRT Holdings (as successor by merger to TRT US) through conversion of the subordinated debts in TRT Holdings of US$49.7 million to equity.
FGV US LLC, which was set up initially as a special purpose entity to fund the loan to TRT US to mitigate the risk of recharacterising the debt as equity in the event of a bankruptcy filing will be dissolved.
Since the intercompany subordinated debt is being forgiven, there is no need for this entity to remain in existence, the investment bankers said.
Lastly, a debt restructuring will be undertaken by TRT Holdings ETGO Inc and Twin Rivers Technologies Entreprises de Transformation de Graines Oléagineuses du Québec Inc (TRT-ETGO Inc).
The debt restructuring involves the conversion of their respective 73,053,223 units of Class A preferred shares valued at C$73.05 million in exchange for 1,000 common shares valued at C$73.05 million, as well as the injection of funds by FGVH, via FGV North America and TRT Holdings ETGO Inc, into TRT-ETGO Inc which will then be used to settle TRT-ETGO Inc’s external
debts of C$102 million.
TRT-ETGO Inc is a wholly-owned subsidiary of TRT Holdings ETGO Inc, which in turn is a wholly-owned subsidiary of TRT Holdings.
TRT US is a wholly-owned subsidiary of TRT Holdings, which in turn is a wholly-owned subsidiary of FGV North America.
FGV North America is a wholly-owned subsidiary of Felda Global Ventures Downstream Sdn Bhd (FGV Downstream”) which in turn is a wholly-owned subsidiary of FGVH; and FGV US LLC is a wholly owned subsidiary of FGV North America.
The objective of the proposed internal reorganisation is to streamline operations whereby FGV Downstream via FGV North America will directly own TRT Holdings ETGO Inc via subscription of 1,000 common shares in TRT Holdings ETGO Inc, and the merged entity of TRT US and TRT Holdings after the exercise.
The reorganisation is expected to result in improved management flexibility in terms of operations, including facilitating future business arrangements and the development of businesses.
The repayment of external debts by TRT-ETGO Inc is intended to reduce its debt obligations and is expected to place it on a stronger financial footing to improve its future profits and growth.
FGVH will drawdown its existing borrowing facilities and subsequently extend the funds to FGV North America, said CIMB and Maybank Investment Bank.
FGV North America will use the funds to subscribe for shares in TRT Holdings ETGO Inc.
TRT Holdings ETGO Inc will in turn use the funds to subscribe for shares in TRT-ETGO Inc.
TRT-ETGO Inc will then use these funds to settle its external debts of C$102 million, they added.
Pursuant to the exercise, the proceeds from FGVH’s initial public offering that is currently earmarked for the repayment of borrowings of TRT-ETGO Inc will be utilised to repay the borrowings facilities to be drawn down by FGVH.