The Singapore-listed containership owner and operator is unable to meet on-going coupon and principal payments on $100 million Singapore (U.S. $73.2 million) on 8.45 percent notes due May 2017, the company said in a presentation to noteholders.
Rickmers Maritime is seeking to restructure debts worth $100 million Singapore (U.S. $73.2 million) in order to avoid a complete liquidation, the company said in a presentation to holders of certain senior notes.
The Singapore-listed containership owner and operator said it is unable to to meet on-going coupon and principal payments on 8.45 percent senior notes due May 2017, as well as $179.7 million in senior debt due March 2017.
Rickmers Maritime said it needs to restructure its debt in order to continue to operate, and as such, is seeking bondholders’ approval to convert the debt into $28 million Singapore of new perpetual convertible bonds with a step-up coupon starting at 3.88 percent.
If it is unable to restructure, the company could be liquidated or placed in court receivership, which would likely result in a “total loss” for noteholders.
If, on the other hand, the restructuring is approved, it would allow the company to continue to make coupon payments under the new securities, as well as share equity upside with and maximize value recovery for noteholders, according to Rickmers.
Rickmers in August appointed PricewaterhouseCoopers and Morgan Lewis Stamford as advisors in an attempt to get its financial house in order and avoid going under.
The company said noteholders will be able to vote for the restructuring following a notice of meeting and consent solicitation statement to be sent out some time around Sept. 26. The vote meeting will be held on or around Oct. 18, at which point a minimum 75 percent of value will be required to be in attendance themselves or via proxy.
The vote will require 75 percent approval of votes cast in order to pass, and will be subject to regulatory approval from the Singapore stock exchange.
If the restructuring is not approved by note holders, it could have “critical consequences” for Rickmers, the company said.
A “no” vote would severely limit the company’s ability to continue operating on an ongoing basis, making it “highly unlikely to refinance significant repayment” of the U.S. $179.7 million in debt due in March 2017, in addition to maximizing losses for all stakeholders, Rickmers warned.
Rickmers Maritime owns a portfolio of 16 containerships with a total capacity of 66,410 TEUs, according to its website. All of the company’s vessels, which range in capacity from 3,450 TEUs to 5,060 TEUs, are chartered to ocean carriers, including CMA CGM, Maersk Line, Mitsui O.S.K. Lines Ltd and NYK Line.
Rickmers Maritime seeks to restructure debts
