Court gives mm2 time to work out plan to repay its creditors

Moratorium shields group from creditors and legal proceedings for four months

- Toh Yong Chuan Assistant Business Editor

Debt-ridden entertainment group mm2 Asia has been given a lifeline after the High Court on Dec 10 allowed the company to be shielded from creditors and legal proceedings for four months while it works out a restructuring plan.

The move will allow the company time and breathing space to work out a plan to repay its creditors, said Judicial Commissioner Mohamed Faizal in a written judgment after a hearing.

On Nov 10, mm2 said in a bourse filing that it had applied to the High Court for a moratorium under the Insolvency, Restructuring and Dissolution Act to stop current, pending or threatened proceedings from being commenced or continued against it.

The application was made after the company and its subsidiaries received repayment demands from several creditors, including UOB, for $74.6 million; Frasers Centrepoint Trust for $2.6 million; and Standard Chartered for $905,000.

The application was heard on Dec 10 and the High Court granted mm2’s application.

Other than UOB, Frasers and StanChart, the group owes Linkwasha Holdings more than $7.55 million in principal and accrued interest in July 2025 for a $30 million loan it took in 2017 to partially finance the acquisition of Cathay Cineplexes.

The group also owes Alprop about $794,000 and it faces impending defaults on bonds totalling over $63 million.

The debt that mm2 faced “resulted in an untenable situation where it faces imminent winding-up proceedings if it is not provided the breathing space that is provided by a moratorium”, said the judge.

In its court application, mm2 said it intends to distribute $12 million among its creditors after restructuring, translating to the creditors receiving about 28 cents for every dollar of outstanding debt. If it had been liquidated, mm2 said the creditors may receive nothing, or at most 2.55 cents on the dollar.