Update on the moratorium applications
June 27, 2023
We refer to the announcements of 10 May 2023, 9 June 2023, and 23 June 2023.
On 20 June 2023, all five entities in the Zipmex moratorium group (the “Moratorium Group”) filed applications for extension of the moratoria granted by the Singapore High Court (“Applications”). The Moratorium Group is seeking an extension of the moratoria until 11 August 2023.
Copies of the papers filed in the Applications have been circulated individually to each creditor by the scheme managers.
The Applications have been fixed for hearing at 2.30 pm on 30 June 2023.
During the period of the extended moratorium sought, two entities in the Moratorium Group, Zipmex Asia Pte Ltd (“Zipmex Asia”) and Zipmex Pte Ltd (“Zipmex Singapore”), intend to propose replacement schemes of arrangement (“New Schemes”) to their creditors. These New Schemes are intended to replace the existing schemes of arrangement currently in force.
The New Schemes are necessary because the existing schemes are incapable of being completed due to the previous investor (“Investor”) having taken the position that the SSA has been terminated.
Under the New Schemes, the Moratorium Group’s assets will be realised and creditors of Zipmex Asia and Zipmex Singapore will be apportioned a portion of the proceeds from such realisation. The manner in which Zipmex Asia intends to realise these assets is as follows:
- Zipmex Asia’s shares in Zipmex Company Limited and PT Zipmex Exchange Indonesia will be sold to third-party purchasers. Negotiations for the sale of Zipmex Company Limited are presently at an advanced stage and a term sheet has been signed.
- Zipmex Asia’s claims against Celsius Network will be sold for value.
- Zipmex Asia’s reserve of ETH and potentially ZMT will be realised for value.
- Movable assets like laptops and mobile phones belonging to the Moratorium Group will be realised for value. (“Immediately Realisable Assets”)
In addition, Zipmex Asia has claims against the Investor and claims against entities in the Babel Finance group (“Babel”) from which value can be realised. Zipmex Singapore similarly has a claim against Babel. Babel is undergoing its own moratorium and scheme-of-arrangement process in the Singapore High Court and the timeline of recovery from these assets is unclear.
It is intended, under the New Schemes, for the proceeds of the Immediately Realisable Assets to be pooled and distributed to creditors of Zipmex Asia and Zipmex Singapore within 3-4 months from the date that the New Schemes – if approved by the creditors – go into effect. The remaining claims which have a longer runway to monetisation will be distributed to eligible creditors after they are received.
Under the New Schemes, each creditor of Zipmex Singapore and Zipmex Asia is expected to receive approximately of 5.1% return on their debts in USDC.
This is compared to the alternative, which is a liquidation of Zipmex Asia and Zipmex Singapore. In such a scenario, creditors are expected to receive a maximum of 1.64% of their debts.
We thank the creditors for their continued patience in the Moratorium Group’s on-going restructuring proceedings and seek their support for the Applications and the New Schemes.