SINGAPORE - Rickmers Maritime announced on Thursday (Sept 22) an "improved" restructuring plan for its S$100 million 8.45 per cent notes due 2017, after taking feedback from its informal meeting with noteholders last week.
It is now proposing a partial redemption of S$60 million of the principal in exchange for 60 per cent of the enlarged units of the trust, which will reduce the outstanding principal amount under the notes to an aggregate of S$40 million repayable in November 2023.
The shipping trust is also proposing to issue 1.32 billion new units representing 150 per cent of the current number of units outstanding, said the trust's manager in a filing to the Singapore Exchange.
Said Mr Soeren Andersen, CEO of the trust's manager: "We value noteholders' feedback and have reflected their suggestions in this proposal.
"One of the key suggestions raised at the informal meeting was for a more substantial debt to equity swap, which requires unitholders' approval at an extraordinary general meeting. We can't be sure that unitholders will approve the dilution, but we will try. In the essence of time, we will run both processes to seek unitholders' and noteholders' consents in parallel.
"The proposal that we are presenting is equitable. If accepted, it would make way for a new facility of about US$260.2 million, and extends the maturities of a large part of the trust's secured bank debts to the first quarter of 2021 and includes, amongst other terms, a generally back-ended amortisation schedule. This would give the trust more time to weather the depressed market, and underpins its solvency," said Mr Andersen.
In support of the new proposal, Rickmers Holding AG, the trust's sponsor which 34.2 per cent of its units, has indicated that it will vote in favour of the resolution to issue 1.32 billion new units as a partial redemption of the notes.
Said Mr Tomas Norton de Matos, chief financial officer of the trust's manager: "We urge all unitholders and noteholders to very carefully consider the proposals. If not executed within a short period of time, industry conditions and the Trust's liquidity position may preclude a consensual solution by all of us. On the other hand, a successful restructuring would result in the provision of the new facility to Rickmers Maritime, providing the trust with a longer runway to survive the industry downturn and turnaround the business."