Genco Reaches Bankruptcy Restructuring Deal

Posted by Eric Haun
Friday, April 04, 2014
Photo: Genco Shipping & Trading Ltd.

Genco Shipping & Trading Ltd. will cut its debt by more than $1 billion by giving control of the company to its lenders in a deal that requires the dry bulk shipping company to file for bankruptcy.

Lenders backing a $1.06 billion credit facility would convert their debt into about 81.1 percent of company's stock, according to a regulatory filing from Thursday.

Investors who hold $125 million of Genco convertible debt would receive 8.4 percent of the company. The remaining equity would be allocated to those investors funding a $100 million rights offering, while management would also get a 1.8 percent stake in the company.

Existing Genco stock would be canceled and shareholders would receive warrants for 6 percent of the reorganized company's stock.

Genco stock jumped 28 percent to $1.96 per share on the New York Stock Exchange in late trading on Friday.

The agreement requires Genco to file for Chapter 11 bankruptcy in the U.S. Bankruptcy Court in Manhattan. A bankruptcy would allow the company to force a small number of hold-out creditors to accept the plan.

Firms that specialize in distressed investing - Centerbridge Partners, Apollo Management and Solus Alternative Asset Management - would rank as the largest shareholders after the company reorganizes.

The company joins a growing list of shipping companies that have been struggling as charter rates have been depressed by a glut of large new vessels. A U.S. energy boom has also hit some companies as oil shipments to the United States have dropped.

Peter Georgiopoulos, Genco's chairman and one of its largest stockholders, was a founder of General Maritime Corp, a shipping company that succumbed to Chapter 11 bankruptcy in 2011. The company emerged a year later under the control of Oaktree Capital Management, a distressed investment firm.

Genco has hired Kramer Levin Naftalis & Frankel to lead the restructuring talks and Blackstone Advisory Partners as a financial adviser.

(Reporting by Tom Hals in Wilmington, Delaware; Additional reporting by Billy Cheung in New York; Editing by Dan Grebler)

Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Reftrade Upgrades Fleet Refrigeration Systems

Reftrade UK  has made an investment  to upgrade its fleet with environmentally friendly technology. The world’s first refrigeration system to use CO2 as a natural refrigerant,

ClassNK Reports Record 2014

Announcing its registration totals for 2014, ClassNK said 833 new vessels with a combined total of 21,466,272 gt joined its register over the course of the year,

GE Launches GE Marine Organization

GE unveils GE Marine organization to power, propel and position the global marine industry   GE unveiled today its new GE Marine organization which cumulates

Bulk Carrier Trends

Baltic Sea Freight Index Falls to Lowest Level Since 1986

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, spiralled downwards to its lowest level in nearly three

Pacifica Rolls Out New Container Vessel

Pacifica Shipping, New Zealand's coastal shipping company, is launching a new container vessel from March replacing a smaller vessel whose charter has ended, reports The Stuff.

Shipping Pollution Will Skyrocket -Study

International freight volumes will grow fourfold by 2050 while the average length of haul will increase by 12 percent over that time, trends that will cause a spike

Finance

Baltic Sea Freight Index Falls to Lowest Level Since 1986

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, spiralled downwards to its lowest level in nearly three

Bill Proposed to Repay WWII Merchant Mariners

Congresswoman Janice Hahn (Calif.) and Congressman John Duncan Jr. (Tenn.) introduced the “Honoring Our WWII Merchant Mariners Act of 2015,” which would provide

Stolt-Nielsen Q4 Profit Misses Forecast

Shipping firm Stolt-Nielsen reported fourth quarter earnings below forecasts on Thursday and said it was concerned about the outlook for the chemical tanker market,

News

Baltic Sea Freight Index Falls to Lowest Level Since 1986

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, spiralled downwards to its lowest level in nearly three

Bill Proposed to Repay WWII Merchant Mariners

Congresswoman Janice Hahn (Calif.) and Congressman John Duncan Jr. (Tenn.) introduced the “Honoring Our WWII Merchant Mariners Act of 2015,” which would provide

Navigational Charts App Debuts at Ocean Business

An independent consultancy and software development company will launch a new web and PC based navigational charting app at Ocean Business 2015.   Norcom Technology

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Standards Naval Architecture Offshore Oil Pod Propulsion Ship Electronics Ship Repair Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | 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: 0.2204 sec (5 req/sec)