Standard & Poor's today lowered its long-term corporate credit and senior unsecured debt ratings on Cammell Laird Holdings PLC (Cammell Laird) to 'D' from double-'C' and single-'C', respectively.
At the same time, the ratings were removed from CreditWatch, where they were placed with negative implications on Nov. 30, 2000.
These actions follow the appointment of receivers to intermediate holding company Cammell Laird Group PLC, and the Group's failure today to make the first coupon payment of EUR7.5 million ($6.7 million) on its EUR125 million 10-year bond. Cammell Laird Group acts as the guarantor of Cammell Laird's senior unsecured notes.
Cammell Laird is a small U.K. shipbuilder that generated revenues totaling GBP129 million ($185 million) in the year to Oct. 31, 2000. The company has been under severe financial pressure for several months following the breakdown of the $73 million Costa Classica cruise ship conversion contract
in January 2001. Replacement income, sought from the potential $500 million Luxus contract, placed heavy demands on the company in terms of funding requirements and could not be secured.
Having recently undertaken a strategic review of the business to explore a possible restructuring of the balance sheet or sale of operations, Cammell Laird has announced that its financial resources are insufficient to continue this process.
Consequently, Cammell Laird Group's principal bankers have appointed receivers to realize best value from the business, either through a solvent sale of all or part of the shipbuilder's operations, or alternatively by realization of its assets, Standard & Poor's said.