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Bumi Armada refinances debt, plans asset disposals

Malaysia’s Bumi Armada has refinanced $660m of its short-term corporate debts to improve its balance sheet and is looking to dispose of some assets to free up cash.

Kuala Lumpur-listed Bumi Armada has refinanced its unsecured term loans of $380m and revolving credit facilities of $280m into a single facility consisting of two tranches of $260m and $400m, repayable over two and five years respectively.

“The refinancing of the short-term corporate debt alleviates one of the group’s main current exposures. The new facility better aligns the corporate debt profile with the cash flow profile of the group’s main FPO business,” said Leon Harland, executive director and ceo of Bumi Armada.

Harland added that Bumi Armada will have to focus on maximising revenue while continuing to manage its operational costs, as well as to find additional value via asset monetisation or other structural improvements.

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“As part of this, the offshore marine services assets together with certain FPO vessels which are idle will be disposed of assuming commercially acceptable sale terms can be obtained,” he said.

“Surplus funds from operations and part of the proceeds from certain strategic initiatives including monetisation of assets and new project financing will be used to repay the loans.”

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