Tankship Owner, Gulf Navigation Group, in Dire Straits

MarineLink.com
Wednesday, November 13, 2013
Gulf tankship in previous ownership colours: Photo courtesy of Frontline

The Dubai-based shipping company Gulf Navigation has posted a loss of Dh614.3-million in Q3 2013 attributable to a Dh292.8m impairment of goodwill and a write-off of Dh308.6m of the value it expected to receive for the sale of its two very large crude carriers (VLCCs). Doubts about the company’s survival prospects increase and on this question the company states as follows:

Going concern
The Group's condensed consolidated interim fmancial infonnation has been prepared on a 'going concem' basis, however, given the conditions and events described below there exists a material uncertainty that may cast significant doubt about the Group's ability to continue as a going concem.

The Group incurred a loss of AED 644,033 thousand during the nine month period ended 30 September 2013 and, as of that date; the Group had accumulated losses of AED 1,121,705 thousand which represents more than one half of the Group's share capital.

In accordance with the UAB Federal Law No 8. of 1984, there is a requirement to convene an extraordinary general meeting ("EGM") of the shareholders and obtain a resolution from the shareholders to enable the Group to continue as a going concem. Therefore, the Directors have resolved to convene an EGM in December 2013 to put forward a resolution that the Group shall not be dissolved and continue its operations in the nonnal course of business.

The ability of the Group to continue as a going concem is reliant upon obtaining the approval of the shareholders in the EGM and continued availability of extemal debt financing and additional equity. At 30 September 2013, the Group was in breach of the tenns ofthe loan agreements with its lenders.

Further during the period, the Group was unable to make payment of a loan instalment of USD 938 thousand (AED 3,433 thousand) which was due in July 2013 (Note 8). These breaches gave the lenders the right to call an event of default and by further notice, declare that all the loans are payable on demand. Accordingly, the Group's bank borrowings are classified as current liabilities at 30 September 2013.

These events have resulted in the Group having a net current liability position at 30 September 2013 of AED 542,794 thousand.

 On 13 September 2013 and 4 October 2013, two of the Group's vessels, Gulf Sheba and GulfEyadah, were arrested at the instructions of the lenders at the Port of Rotterdam and at the Port of Bahamas respectively. Notwithstanding such arrest, management is continuing its discussions with its lenders to proceed for a consensual sale of both vessels and restructure the payment of the shortfall of loans relating to these vessels.

If the Group is not able to agree the required restructuring of the remaining loan related to the vessels and in the absence of other financing altematives, the Group would be dependent on market based asset values to repay its borrowings. As a result, there exists a material uncertainty which may cast significant doubt on the ability of the Group to continue as a going concem such that the Group may be unable to realise its assets and discharge its liabilities in the nonnal course of business. Accordingly, assets may be realised at significantly less than book value and additional liabilities may arise.
 

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter July 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Young Taken on PESA Advisory Board

Hoover Container Solutions’ chairman and CEO, Donald Young, has been nominated and elected to the Petroleum Equipment & Services Association (PESA) Advisory Board for a three-year term.

US Navy Tests Latest Aegis Weapon System

The U.S. Navy conducted a series of cooperative air defense test exercises with the Spanish navy that culminated in live missile firing events using the latest Aegis Weapon System baseline July 20-21.

Antwerp Port CEO Scoops Baron Title

After 25 years as CEO of Antwerp Port Authority, Eddy Bruyninckx has been raised to the nobility by H.M. the king of Belgium with the rank of baron. In Belgium

Legal

Ecuador Pays $112 mln Award to Chevron

Ecuador has paid $112 million to energy company Chevron Corp over a four-decade-old contract dispute, even though it remains in disagreement, the head of the central bank has said.

ASEAN in Discord Ahead of Meeting with top China, U.S. Diplomats

Southeast Asian nations were thrown into disarray after Cambodia on Saturday blocked them from issuing a statement referring to an international court ruling against

Cosco: No to Shark Fin

China's biggest shipping and logistics company Cosco has pledged a total ban on transporting shark's fins,  says SCMP. It called the move a "body blow" to the international shark's fin trade.

Tanker Trends

Libya's PFG to Lift Terminal Blockades

Petroleum Facilities Guard has blocked terminals for months. Ras Lanuf, Es Sider terminals damaged by fighting. Libya's Petroleum Facilities Guard (PFG) will

Unipec: U.S. ANS Destined for Sinopec

Arbitrage opens after ANS discount widen on ample supplies. Unipec, the trading arm of top Asian refiner Sinopec, has bought two U.S. crude cargoes, including

Asia Tankers-VLCC Rates to Hold, Ample Tonnage Weighs

"Pure" chartering market with little disruption. Rates to hold around W45 for Middle East; W48 for West Africa. Freight rates for very large crude carriers (VLCCs)

Finance

Canadian Authorities seek to contain oil spill moving down river

Authorities are building a new containment boom to fight an oil spill in a major western Canadian river, officials said on Saturday, after the spill breached a

Ecuador Pays $112 mln Award to Chevron

Ecuador has paid $112 million to energy company Chevron Corp over a four-decade-old contract dispute, even though it remains in disagreement, the head of the central bank has said.

NASSCO Bags USS Oak Hill Modification Award

General Dynamics NASSCO-Norfolk was awarded a $42 million cost-plus-award-fee modification to a previously awarded contract for the repair and alteration for the USS Oak Hill (LSD-51).

Middle East

Antwerp Port Inks Iranian Collaboration

Last week Antwerp Port Authority signed a collaboration agreement with Shahid Rajaee Port Authority which controls the port of Bandar Abbas in Iran.   Bandar

Hapag-Lloyd, UASC Merger

Hapag-Lloyd and UASC have signed a Business Combination Agreement.   The Combined company will rank among the world´s five largest liner shipping companies and

HMAS Darwin Returns from Middle East Deployment

Family and friends joined Chief of Navy, Vice Admiral Tim Barrett on the wharf at Garden Island, Sydney to welcome HMAS Darwin home from a successful Middle East deployment.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Maritime Standards Naval Architecture Offshore Oil Pipelines Pod Propulsion Ship Simulators Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1215 sec (8 req/sec)