Rickmers says its biggest senior lender may be willing to consider material debt forgiveness

The office of container ship operator, Rickmers Maritime.
The office of container ship operator, Rickmers Maritime.PHOTO: ST FILE

SINGAPORE - The trustee manager of Rickmers Maritime disclosed on Monday (March 13) that HSH Nordbank, its largest senior lender, has indicated that it may be willing, subject to further internal deliberations and approvals, to consider a material debt forgiveness of the existing loans that it has extended to the shipping trust.

This is subject to the trust being able to secure similar, substantial debt forgiveness from its noteholders and other unsecured creditors and raise additional equity, and provided that its recovery would in this case be higher than its recovery from an immediate winding-up of the trust and that recovery of its debt will not be prejudiced by the claims of other creditors.

In all other cases, the senior lender indicated it would support an orderly winding-up of the trust.

The trustee-manager said that following from this, it is currently in discussions with its advisers to formulate a new framework for restructuring the liabilities of the trust and intends to present a new restructuring proposal to its creditors and noteholders when it has been finalised.

"Given that the trust is formulating a new proposal for the restructuring of its liabilities, the trustee-manager is of the view that there is still basis for the trust to continue and the trust should not be wound up in accordance with its trust deed at this time," it said.

As at end-2016, Rickmers has outstanding bank debt of US$270.8 million, as well as outstanding debt of S$100 million in medium term notes maturing in May 2017.