ZURICH Nov 24 The former chairman of Saudi
construction firm Mohammad al-Mojil Group (MMG) proposed a plan
on Thursday to save the financially troubled company, including
recapitalisation and a mechanism to recover money it says it is
owed by contractors.
Adel al-Mojil resigned as chairman in June, along with other
members of the board, but still has shares in the company. His
father, who founded the company 60 years ago, still holds a
"I present here elements of a practical solution to the
company's problem that will return part of the shareholder
value," he told a rare news conference in Zurich.
He said the company had suffered losses of 1.5 billion Saudi
riyals ($400 million) after its 2008 public listing as a result
of bills that had not been paid by contractors while working on
projects for state oil giant Saudi Aramco.
It aims to collect between 700 to 900 million riyals
($187-$240 million) in claims from other firms as part of a
recovery plan, according to former company officials.
Mojil's proposals include forming a new independent board of
directors, recapitalising the company via "unconventional equity
and debt instruments" and presenting an amicable settlement of
trade creditors' demands.
He also suggested that Saudi Aramco should set up a
committee to supervise the payment of money he said MMG was owed
by contractors on Aramco projects.
Saudi Aramco did not immediately respond to an emailed
request for comment sent outside normal business hours.
MMG's board quit in June when the Saudi stock market
regulator (CMA) sentenced three people, including Mojil and his
father Mohammad, to between three and five years in prison. They
The three were found guilty of manipulation and fraud
relating to the MMG's initial public share offer in 2008 - a
decision which the company said was based on "fundamentally
flawed" evidence. The CMA also ordered payment of 1.6 billion
riyals ($427 million) in damages.
Later in June, the CMA said it would form a committee to
At a news conference in a posh Zurich hotel, Mojil, dressed
in traditional Arab robe and headdress and accompanied by his
attorney, denied accusations of wrongdoing, insisting his family
and MMG had always acted in good faith.
MMG said on Monday it had written to Deputy Crown Prince
Mohammed bin Salman explaining that it may not be able to
continue operating. It was unclear if the privately owned
company was seeking financial or other assistance from the
"We have sent two letters, one letter to (late) King
Abdullah and to King Salman and we have talked to a number of
ministers and responsible authorities for Aramco," Mojil told
reporters through a translator. "There was no response."
He said the press conference was being held in Zurich
because of "special circumstances", but did not elaborate.
(Reporting by Michael Shields, Writing by Reem Shamseddine;
Editing by Adrian Croft)