The first capital reduction will take the form of a 10-to-one share reduction on 29 November for shares held by STX Corporation, STX Offshore & Shipbuilding, STX Engine and Duk-Soo Kang. Ordinary shareholders will get a two-to-one cut. Overall, 113.5m will be boiled down, reducing 205.8m shares down to 92.3m.
A debt-to-equity conversion on 13 December 2013 will see creditors receive a total of 1.23bn new shares; the top recipients include Korea Development Bank, Korea Finance Corporation and Hana Bank. The share issue will write off KRW1.2tn ($1.1bn) in unsecured debts.
A second capital reduction of ten-to-one on 27 December will leave 132m shares outstanding in the company.
Unsecured creditors will receive 33% of the debt in cash, with the remaining 67% converted to equity. Cash instalments start small at 2% in 2014, with the first significant payment of 22% in 2018 and 2019, followed by 66% between 2021 and 2023.
Secured creditors will receive cash in full, 60% in 2014 and 2015, with the remainder in 2016.
The plan, which was submitted to Seoul Central District Court in October gained approval after it was revised and resubmitted on 19 November, receiving 100% support from secured claims creditors and 74.5% agreement from unsecured claims creditors at a meeting of interested parties today.
Copyright © 2024. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited. Add Seatrade Maritime News to your Google News feed.
