OSV and rig owner and operator Swissco revealed in its latest financial results statement that it has reached an impasse with its major lenders, as the lenders have not agreed to Swissco’s restructuring plan.
“A significant gap persists between the group’s aim of sustaining its business in the long term and the position of these lenders. As such, the group is unable to get an agreement on the terms of the restructuring plan,” Swissco said.
“In the circumstances, the group has decided to file for an interim judicial management order over the company with a view to achieving one or more of the statutory objects of judicial management under section 227B of the Companies Act,” the Singapore-listed firm stated.
“The group is currently seeking legal advice with respect to the preparation and filing of the necessary court documentation, which is expected to take place by the end of this week or early next week.”
Swissco’s plan to file for judicial management comes about three-and-half months after another Singapore-based offshore services firm Swiber was placed under judicial management.
The severe downturn of the global oil and gas industry, coupled with lingering oversupply, have created extremely challenging operating environment for offshore firms.
“The group expects the market conditions in the oil and gas industry to remain weak in the next 12 months and there is no visibility as to when the oil and gas market conditions will improve,” Swissco said.
Swissco earlier announced a grim scenario that it has $147.5m in debt maturing between now and 2020, and has just $1.2m in cash and a monthly cash burn of $1.5m.
Meanwhile, Swissco posted a deep loss of $295.97m for the third quarter ended 30 September 2016 as against the profit of $11.18m in the same period of last year.
The quarterly revenue declined by 63.5% year-on-year to $3.81m. No revenue was derived from the drilling division in year 2016, while contributions from the OSV segment fell mainly due to lower utilisation and lower charter day rates.
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