EMAS Offshore subsidiary to be wound up on ICBC Leasing’s request

The High Court of Singapore has ordered the winding up of Lewek Champion Pte Ltd, wholly-owned by EMAS Offshore Limited (EOL), following a request made by Hai Jiang 1401, a special purpose vehicle fully owned by China’s ICBC Financial Leasing.

In April this year, Hai Jiang 1401 issued a statutory demand against Lewek Champion, demanding payment of around $195.02m relating to the termination of a bareboat charter.

The vessel involved is the 2007-built, 16,155-dwt pipe-lay vessel Lewek Champion.

The vessel owner Hai Jiang 1401 alleged that Lewek Champion defaulted on payment of $1.58m under the bareboat charter as part of a sale-and-leaseback agreement entered into in February 2014. The purchase price of the vessel under the 2014 agreement was $200m.

The sale-and-leaseback arrangement stipulated a vessel charter period of 120 months, and that the bareboat charterparty is a “hell and high water” charterpary.

The Singapore court said Andrew Grimmet and Lim Loo Khoo of Deloitte & Touche LLP have been appointed as joint and several liquidators of Lewek Champion.

EOL said that based on unaudited consolidated financial statements for the period ended 30 November 2016, EOL owed approximately $68.84m to Lewek Champion. The winding up order will accordingly lead to a material impact on the financial position of EOL.

Ezra Holdings, parent firm of EOL and guarantor of EOL for the sale-and-leaseback agreement, has filed for Chapter 11 bankruptcy in March this year.

Posted 27 July 2017

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Lee Hong Liang

Asia Correspondent