Swissco makes claims against charterer, shipbuilders as it reiterates it cannot pay bondholders

Oil rig by Swissco Holdings, Singapore-listed rig and vessel chartering group.
Oil rig by Swissco Holdings, Singapore-listed rig and vessel chartering group.PHOTO: SWISSCO HOLDINGS LIMITED

SINGAPORE - Debt-ridden Swissco Holdings is demanding a sum of US$31.3 million (S$43.1 million) from three firms as it struggles to stay afloat, and has begun arbitration proceedings in Hong Kong, it said on Wednesday (Oct 12).

The rig and vessel chartering group also called for a trading suspension, given the on-going efforts to present a debt restructuring plan. Its shares last traded at 5.2 cents on Monday, before trading was halted ahead of the informal note holder meeting that afternoon.

Star Excellence (HK), in which Swissco has a 50 per cent stake, is claiming US$26.1 million against charterer Tyloo for outstanding charter hire amounts due and owing to Star Excellence under a bareboat charterparty entered into between the parties.

Meanwhile, Swissco Offshore, a wholly-owned unit of Swissco, has also made a US$5.2 million claim against shipbuilders Nanjing East Star and Jiangsu Skyrun for a refund of two instalments paid by Swissco Offshore. The contracts have been terminated due to substantial delays in the delivery of the contracted vessels, Swissco said.

Separately, Swissco said is disputing a US$1.69 million claim from X-Drill Holdings that alleges the amount is due in relation to services provided by X-Drill to rigs owned by four Swissco units. Swissco said it had responded to a statutory letter of demand from X-Drill a week ago (Oct 5).

Swissco told holders of its $100 million bonds on Monday (Oct 10) that it cannot pay out a $2.85 million coupon due next Friday and had no plans for its next course of action.

It then invited holders of the 5.7 per cent bonds which mature in 2018 to form an informal steering committee to work with financial adviser Ernst & Young (EY) to develop a "mutually agreeable" restructuring plan. EY will begin discussions with note holders next week, and a second informal note holder meeting will be held in four weeks.

Swissco faces a US$147.5 million ($202.7 million) mountain of bank debt maturing from now until 2020. Add to that the principal owed to bond holders in 2018 and Swissco has a total debt of US$221.6 million.