The Singapore-listed shipping trust has failed to reach agreement on a new restructuring proposal with creditors and new investors, after noteholders rejected its previous proposed restructuring in December 2016. As a result of the rejection by SGD100m noteholders a proposed $260m refinancing package did not go ahead.
A syndicate of lenders comprising HSH Nordbank and DBS Bank had given Rickmers Trust Management (RMT) until 15 April to present a new restructuring plan.
“The Trustee-Manager is disappointed to have to announce that, after much effort placed on achieving a consensual restructuring among creditors, potential investors have not supported an injection of new equity into the trust due to the challenges in obtaining, through a consensual process between parties, noteholders’ and other creditors’ consent for significant debt write-offs,” RMT said in a statement to the Singapore Exchange.
Rickmers Maritime had failed to make a $196.7m principal repayment to its banking syndicate on 31 March and SGD4.3m coupon payment to noteholders in November 2016, as well as various loan covenants breaches had resulted in going concern issues for the trust and “aggravated and unsustainable liquidity going forward”.
With the failure to secure new investors and liquidity issues RMT said it was impracticable to continue the trust and it was being wound-up.
“The winding up decision is made in light of no other possible alternatives to restructure the liabilities of the Trust with the objective of delivering value on an accelerated basis to all creditors to avoid uncertainties and risks involved in a protracted winding up process,” RMT said.
RMT in said it was in “advanced discussions” with a potential buyer of the trust’s assets “which may allow the Trust to distribute cash recoveries upfront to unsecured creditors”.
The trust has fleet of 14 panamax containerships which have seen a sharp drop in values and charter rates since the opening of the expanded Panama Canal in late June last year.
RMT had previously warned noteholders that as unsecured creditors they were likely to receive nothing if the trust was wound-up. Singapore notheholders, private investors with a minimum sum of SGD250,000, have played hard ball in restructuring with a number of Singapore-listed maritime and offshore companies with mixed results.