Moody's Downgrades Enterprises Shipholding
Moody's Investors Service downgraded to C from Caa1 the rating for senior notes of Enterprises Shipholding Corporation. The downgrade reflects the company's announcement to consider a restructuring of debt and the intention not to pay interest on the senior notes which is due in May 2001. The senior implied rating has also been downgraded to C from Caa1, the issuer rating has been lowered to C from Caa2. The company's failure to meet interest payment in Moody's view constitutes a default on the company's debt. The company appointed a financial advisor to assess the restructuring alternatives for Enterprises. The C rating for the senior…
Enterprise Shipholding Rating Downgraded To B2 From Ba3
Moody's Investors Service downgraded its rating for the senior notes of Enterprises Shipholding Corp. to B2 from Ba3. The downgrade reflects Moody's expectation that the pressure on freight rates will continue to build beyond the normal level of seasonality, especially in the light of substantial excess capacities in the reefer industry. In addition, management faces the challenge of allocating operating cash flow and balance sheet liquidity between operating requirements, debt service and advance/progress payments for newbuilts. Furthermore, the current market value of the underlying assets is unlikely to recover to a level that provides meaningful asset collateral for the rated debt in the near term.
Enterprise Containership Detained; Repayment of $175 Million Bond Forced
Bondholders who financed the shipping company Enterprises Shipholding, said on Tuesday they had arrested one of the company's newest containerships, the Ocelotmax, to force repayment of a $175 million bond on which it defaulted in June. "The Ocelotmax was arrested to secure the bondholders' unquestionable right to judgment and payment of their claims against Enterprises," said a statement from the bondholders. "While the bondholders have initiated multiple efforts to address the default with the company's management and directors, the company has utterly failed to respond to such efforts," it added. Enterprise's Director and CFO Kostas Koutsoubelis denied the company had failed to respond. "It is us who tried to initiate discussions with the bondholders," he said.
