In a presentation to an informal meeting of noteholders for its SGD100m ($73.7m) issue due in May 2017 warned that it could face liquidation or judicial management if a debt exchange, which is part of a new $260.2m debt facility offered by an HSH syndicate, is not approved.
If Rickmers Maritime’s current debt is not restructured as proposed it said it would not be able to repay $179.7m in senior debt due in March 2017 and would be unable to ongoing coupon and principal payments on the notes due in May 2017.
Noteholders are being asked to approve and exchange to SGD28m in perpetual securities with fixed rate step-up, with a conversion option into 20% of outstanding units in the trust, which Rickmers Maritime said was worth SGD12m.
Battling spot charter rates that are below operating costs for its fleet of panamax containerships and seriously impaired asset values warned of possible liquidation if the debt exchange is not approved which would result in a 100% loss for all noteholders and unitholders.
Rickmers Maritime owns a fleet of 16 panamax containerships, five with long term charters. It decommissioned three vessels in August while the remaining ships are chartered on the spot market.