Rickmers completes winding up, bonds to be delisted

Rickmers Maritime started its winding-up process in April, after debt-restructuring talks failed last December. Trading in its units has been suspended since November.
Rickmers Maritime started its winding-up process in April, after debt-restructuring talks failed last December. Trading in its units has been suspended since November.PHOTO: RICKMERS MARITIME

Shipping trust makes final distributions - a recovery of 12.1% - to its unsecured creditors

Failed container shipping trust Rickmers Maritime has officially sunk after taking on too much water in a badly battered shipping sector.

The trust has been wound up and its outstanding bonds will be delisted from the Singapore bourse at 9am today.

It has made final distributions to its unsecured creditors, representing a recovery of about 12.1 per cent.

There will be no further distributions or payments - cash or otherwise - to the unsecured creditors of the trust, including holders of the $100 million 8.45 per cent notes due this year, the trustee-manager said in an exchange filing yesterday.

The outstanding amount due on the notes has been paid to the notes trustee, DB International Trust (Singapore). This was the final payment to bond holders before the trust was wound up on Aug 16.

The notes trustee will be making arrangements with The Central Depository to credit the relevant distribution amount to each bond holder.

Rickmers Maritime started its winding-up process in April, after debt-restructuring talks failed last December. Bond holders had rejected management's appeal to swap the principal on $100 million of notes of 8.45 per cent, which would have been due this May, for $40 million due in November 2023 pegged to much lower coupon rates.

SOME CASH BETTER THAN NONE

Luckily, HSH Nordbank pulled the trigger to liquidate the company. Otherwise, we may not get much back.

A BOND HOLDER, on how he was prepared to write off his investment.

The trust - saddled with heavy debt amid a depressed charter market - had needed to get bond holders on board before bank lenders would allow it to draw on a US$260.2 million (S$376 million) facility for refinancing. This has led to defaults, Rickmers said.

Its main lender, HSH Nordbank, later granted Rickmers until April 15 this year to present a new restructuring proposal which would ensure a higher level of total recoveries than under a winding-up process, but the trust failed to find investors to pump in fresh equity.

Trading in Rickmers Maritime units has been suspended since last November. The units last traded at a record low of 2.6 cents.

A bond holder, who declined to be named, told The Straits Times he had been prepared to write off his investment completely "because of all the drama that erupted over the few months".

"Luckily, HSH Nordbank pulled the trigger to liquidate the company. Otherwise, we may not get much back," he said, adding that there are bond holders of other firms who may have had it worse.

Rickmers Maritime is but one of several Singapore-listed firms that have struggled with debt over the past year.

In March, oilfield services firm Ezra Holdings filed for US Chapter 11 bankruptcy, following the collapse of Swiber Holdings last year.

More recently, Nam Cheong has defaulted on the $2.25 million coupon and $90 million principal owed to the holders of its Series 002 bonds due on Monday. It also failed to pay the $5 million coupon owed to holders of its $200 million Series 003 bonds - due last Saturday.

A version of this article appeared in the print edition of The Straits Times on August 30, 2017, with the headline 'Rickmers completes winding up, bonds to be delisted'. Print Edition | Subscribe