SINGAPORE (BLOOMBERG, REUTERS) - Rickmers Maritime, a Singapore-listed trust that operates container ships, said it would be wound up after it was unable to reach an agreement with its lenders to restructure its debt or raise new equity.
Rickmers said its failure to repay some debt obligations and various breaches in loan covenants cast material uncertainties on its ability to continue as a going concern.
After much effort placed on achieving a consensual restructuring among creditors, potential investors have not supported an injection of new equity into the trust," Rickmers Trust Management Pte, the trustee-manager, said in a stock exchange filing on Wednesday (April 12). "In light of the aggravated illiquidity and lack of new investors, the trustee-manager opines that it is impracticable to continue the trust and that it shall therefore be wound up."
The trust had flagged the going concern risk last year.
The filing follows bondholders' rejection in December of Rickmers's plan to restructure S$100 million of 8.45 per cent notes, and widens a crack in Singapore's offshore and marine services industry triggered by a slump in oil prices over the past three years.
The trustee-manager said it's in advanced discussions with a potential buyer for the trust's assets, which may allow it to distribute cash recoveries to unsecured creditors, although no deal has been finalized.
"Their assets are not that young, so prices they get won't be attractive," Joel Ng, an analyst at KGI Securities (Singapore) Pte, said by phone. "Some PE firms might be interested in some assets."
Rickmers joins other Singapore-listed companies that have struggled with debt over the last year. Seven companies have defaulted on S$1.35 billion of bonds in the Singapore market since November 2015, according to data compiled by Bloomberg.
In March, oilfield services firm Ezra Holdings filed for US Chapter 11 bankruptcy, following the collapse of Swiber Holdings last year. Singapore banks, which were caught off-guard by Swiber, have taken a hit as companies in the offshore and marine sector restructure debt.
"In light of the aggravated illiquidity and lack of new investors, the trustee-manager opines that it is impracticable to continue the trust and that it shall therefore be wound up," Rickmers said.