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Financially strapped Torm tries to staunch rumours

Financially strapped Torm tries to staunch rumours
Torm today issued an oblique statement updating the market on its progress in addressing the company's long term capital structure.

The statement, relating to the product of employing a financial advisor last year, reads: "This work is now continuing to a stage, where TORM is carrying out a structured process involving a number of external stakeholders to further explore the possibilities for a strategic transaction during 2014. "

Responding to questions as to the nature of the structured process, external stakeholders and strategic transaction, Torm chairman Fleming Ipsen told Seatrade Global, "We have just started the process and in order to prevent rumours surfacing in the market, we made this report to the exchange.

"There is nothing concrete at the moment, the message covers everything we know for certain at this time," Ipsen added. Ipsen is a 30-year senior AP Moller-Maersk veteran, who joined Torm as chairman a year ago.

Following the release, shares in Torm spiked to DKK1.8 from their opening at DKK1.65 this morning and have since settled to around DKK1.7, as investors speculate on the significance of the announcement and any potential "strategic transaction."

Torm was left largely in the hands of its creditor banks after a restructuring at the end of 2012. At the end of November last year, Torm was forced to sell four of its vessels by one of its creditor banks exercising an option it held from the restructuring.