SINGAPORE - Shipbuilder ASL Marine said Monday night that it will hold a meeting for note holders on Dec 16 to engage them in an informal manner prior to launching a formal "consent solicitation" exercise for the restructuring of $150 million notes.
ASL has a $100 million, 4.75 per cent note due in March 2017 and another $50 million, 5.35 per cent note due Oct 2018.
Although the formal terms of the consent solicitation exercise have not been published, the company had said on Nov 29 that it is looking to extend the maturities on these notes by three years or more.
This could come with a coupon step-up of 0.5 per cent per annum, and a redemption of 2.5 per cent of the notes principal every six months, subject to further discussion with the lending banks, said ASL Marine.
It is also seeking to loosen certain bond covenants amid a "considerably more difficult" financing landscape where banks are actively looking to manage their exposure to the sector, and the bond market remains shut to marine sector issuers, the group said.
It also warned that "in the event of an extended downturn, the company may need to make provisions for impairments of accounts receivables or inventories for prudential considerations" which could result in even more covenant pressure.
ASL Marine also said it has signed a commitment letter with various lenders for a $99.9 million five-year club term loan facility, subject to documentation and due diligence.