A bankruptcy court in New York has approved Primorsk International Shipping’s (Prisco) liquidation plan, reports say.
Prisco filed a voluntary petition in January for reorganisation under Chapter 11 in the US Bankruptcy Court for the Southern District of New York, saddled with $262.2m in debt.
It won court permission in late June to auction its nine remaining ice-class oil tankers to SCF Tankers, part of Russia’s Sovcomflot, for $215m.
Under Prisco’s Chapter 11 plan, around $194m in top-ranking debt will be paid in full, and a second-tier group of lenders owed more than $50m will recover about 35 cents on the dollar, according to WSJ reports.
Another $16.4m in swap debt will be left unpaid, but those creditors will receive rights to a newly created trust holding illiquid assets that could one day improve their recovery, the paper said.
Prisco’s debt repayment plan was unanimously approved by creditors in a polling process begun in late August. Repayments to creditors will commence once the sale of the final two tankers has been completed, which is expected later this week, the WSJ said.
The Chapter 11 plan also contains provisions that will protect the company and its lenders from future lawsuits tied to the bankruptcy.
Prisco initially pursued a restructuring proposal, but this was blocked by major lender Nordea Bank Norge, which had provided the company with a $530m secured loan facility.
Nordea subsequently demanded full payment of $262m in loans, which has resulted in Prisco liquidating its assets. .
Prisco is owned by Apington Investments, a British Virgin Islands holding company, which is controlled by Russian native Alexander Kirilichev.
