honestbee, the troubled grocery delivery startup from Singapore, has been granted a four-month debt moratorium by the Singapore High Court. This is two months short of the original six months extension honestbee had appealed for.
According to a statement, honestbee has until 31 January 2020 to work on a re-capitalisation and restructuring plan for its shareholders, some of which will involve converting debt into equity and potentially spinning off select parts of its business.
honestbee said that further details will be announced shortly.
“A successful recapitalisation and restructuring of the business will set a strong path of recovery for the company. This is necessary to ensure that we have the right structure in place moving forward so that we can better serve our customers across Asia,” said Lay Ann Ong, CEO, honestbee.
According to a Business Times report, honestbee had $235.8 million in total current liabilities as of end-June. It is also looking to restructure about $209 million owed to about 1,800 convertible noteholders and trade creditors via a debt-to-equity swap.
The startup’s largest creditors are its key investor Brian Koo, Formation Group and A Honestbee, an entity that’s backed by Koo’s South Korean family business, Yesco. Koo and the entities linked to him account for over 80 per cent Honestbee’s debt and are understood to have expressed support for the moratorium.
Koo stepped down as honestbee chairman on September 12. None of the founding team members – Joel Sng, Jonathan Low, and Isaac Tay remain with the company. The Singapore-based startup is currently led by Ong Lay Ann, who joined honestbee in July as CEO.