The bosses of debt-saddled Swissco Holdings have outlined a plan to save the firm from insolvency.

But the plan is only a preliminary one as Swissco's bank lenders are yet to sign up to the US$260 million (S$362 million) debt restructuring.

At the informal meeting yesterday, chairman Lim How Teck urged holders of Swissco's $100 million bonds to agree to swap US$64 million in principal for equity in the firm, and defer payment on the remaining US$10 million to December 2020 instead of 2018 as originally promised, for a lower coupon rate than the original 5.7 per cent.

Swissco is also seeking to write down some $255 million of bank debt owed to major lender UOB and six other banks to US$70.7 million, and defer some bank loans to 2020. Mr Lim said feedback from potential investors was that they would come in only if Swissco's net debt was pared down to US$80 million.

And the only way to woo new investors to inject cash would be to mark Swissco's assets to market. "Nobody will put in more money unless they are sure that there is a chance to get more money back," said Mr Lim.

Swissco wants to scrap all seven of its idle drilling rigs - three of which are shared with joint venture partner Ezion Holdings - to avoid cash burn from maintenance. It will then try out a brokering model, using its networks to help shipyards with surplus rigs find business.

That leaves Swissco with a fleet of 35 offshore support vessels (OSVs) and a 36 per cent utilisation rate, so the 11 OSVs that are not tied to loans can be sold for cash.

Swissco also has one lift boat that it is trying to find employment for, and two accommodation jack-up rigs with joint venture partners. The charter for one is in default. The other is due to receive payment in the next few months, though Mr Lim noted that "receivables are having a rough time, and nobody gets paid on time".

To tide the firm through the turnaround, the board has offered to draw directors' fees of $1 a year until Swissco turns profitable, though one note holder pointed out that directors' fees had in fact risen from US$76,000 in 2014 to US$468,000 last year.

Emotions ran high at one point when some note holders served a notice to the board demanding immediate payment on interest and principal, causing Mr Lim to raise his voice: "I just simply cannot understand that before you hear a restructuring plan, you jump the gun by saying 'I don't care what the hell you guys do, I want to kill the duck'. If that is the thinking and if all of you agree to just shoot the duck, you'll get absolutely nothing."

Note holders hit back at the board for coming to the negotiating table just six days before their coupon was due, and the focus fell on the board's poor cash-flow planning.

Swissco faces insolvency unless it can rally the support of creditors and attract fresh equity. The company has obtained an informal standstill from the banks who have agreed not to collect on financial obligations until the end of December, though whether that agreement will be renewed remains to be seen.

Swissco has a market value of about $35.1 million. The shares last traded at 5.2 cents on Oct 10 before trading was suspended.