OSV owner and operator Pacific Radiance said the funds will support the company’s working capital needs over the medium term as it continues to refine cost structure, extend reach in targeted markets and work closely with lenders.
“We are pleased to be eligible for the two schemes, which have allowed the group to secure maximum loans of SGD85m,” said Pang Yoke Min, executive chairman of Pacific Radiance.
“The loan approvals from both the participating banks, DBS and UOB, and government agencies reflect their strong support to help the group overcome the downturn,” Pang said.
The two schemes are the International Finance Scheme (IFS) by International Enterprise (IE) Singapore and the Bridging Loan (BL) scheme by SPRING Singapore.
The IFS was enhanced in late-2016 to allow offshore and marine companies to borrow up to SGD70m each, instead of SGD30m previously, for project or asset financing needs.
Under the BL, individual companies can borrow up to SGD5m each, subject to a maximum of SGD15m for each borrower group, and only for a maximum of six years, to finance their operations and bridge short term cashflow gaps.
The Singapore government will take on 70% of the risk share for both the IFS and BL loans.
Despite the present sluggish market conditions, Pang believed that the longer term outlook has improved as Opec and certain non-Opec producers have sustained oil production cuts until June this year and also agreed to extend these cuts by another nine months.
“These positive developments will take time to flow through. Even though vessel utilisation and charter rates are bottoming out, market conditions will remain challenging in the near term,” Pang said.