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Deloitte successfully advises Saudi contractor through an in-court financial restructuring

Deloitte advises on another successful financial restructuring procedure in the Kingdom

25 July, 2022 - Deloitte’s leading KSA bankruptcy team has successfully advised on the financial reorganisation procedure of Al Harbi Trading and Contracting Company, a Riyadh-based company with approximately SAR 1.8 billion (USD 480 million) of debt across seven banks and more than 1200 creditors.

Al Harbi Trading and Contracting Company was established in 1965 and is one of the prominent players in the Kingdom’s contracting sector with key Saudi government and semi-governmental clients, specialising in the transport sub-sector.

On 29 June 2022, the Commercial Court of Riyadh ratified the company’s restructuring proposal following approval from the majority of the company’s creditors regarding its proposed restructuring plan. The restructuring undertaken under the supervision of a court-appointed bankruptcy trustee, and under the laws and regulations of the KSA Bankruptcy Law. 

The Deloitte team acted as the lead restructuring advisor working closely with the company, the trustee, the legal advisor, and the creditor group to develop a sustainable restructuring solution that is palatable to all stakeholders. 

The proposal split the debt into various tranches offering the creditors a diversified repayment structure that leverages the existing assignment of receipts, asset pool, claim recovery and envisaged new business. The restructuring plan also included a combination of debt rescheduling, write-offs and an asset disposal plan which would allow the company to align its debt service capacity with debt commitments and enable an adequate recapitalisation of its balance sheet. 

“Today marks yet another milestone in this journey where we have proudly helped our client and their creditors to successfully navigate the complexity of a financial reorganisation transaction. Having led the charge in advising on numerous complex restructuring situations in KSA over the last few years, I believe our team is uniquely positioned to provide clients with tailored solutions and support them throughout the financial reorganisation process.

We expect the KSA bankruptcy law and the Financial Reorganisation Procedure specifically to continue to be widely adopted in the years to come as they have proven to be effective in circumventing some of the challenges of out-of-court restructurings,” said Karim Labban, Partner and Head of Deloitte Middle East Turnaround & Restructuring team in Saudi Arabia, who led the delivery of this transaction.

Press contact

Nadine El Hassan
Public Relations Regional Leader
Deloitte Middle East
Tel: +961 (0) 1 748444


Click here for the Arabic version

About Deloitte & Touche (M.E.) LLP:

Deloitte & Touche (M.E.) LLP (DME) is the affiliate for the territories of the Middle East and Cyprus of Deloitte NSE LLP (“NSE”), a UK limited liability partnership and member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). 

DME is a leader in professional services with uninterrupted presence in the Middle East since 1926 with 26 offices in 14 countries and around 5,000 partners, directors and staff. DME’s presence in the Middle East and Cyprus is established through its affiliated independent legal entities, which are licensed to operate and to provide services under the applicable laws and regulations of the relevant country. DME’s affiliates and related entities cannot oblige each other and/or DME, and when providing services, each affiliate and related entity engages directly and independently with its own clients and shall only be liable for its own acts or omissions and not those of any other affiliate.

 

About Deloitte:

Deloitte refers to one or more of DTTL, its global network of member firms, and their related entities. DTTL (also referred to as “Deloitte Global”) and each of its member firms are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL, NSE and DME do not provide services to clients. Please see www.deloitte.com/about to learn more. 

Deloitte is a leading global provider of audit and assurance, consulting, financial advisory, risk advisory, tax and related services. Our network of member firms in more than 150 counties and territories, serves four out of five Fortune Global 500® companies. Learn how Deloitte’s approximately 300,000 people make an impact that matters at www.deloitte.com.

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