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DryShips on the brink as creditors circle

DryShips has admitted some its debts have been declared in default and has hinted it might struggle to keep operating as a going concern.

The George Economou-led firm has admitted some of its ships might be sold by creditors if it fails to pay back what it owes. Nevertheless, despite the $103.7m in loan breaches, the company’s annual report shows Economou pocketed $66.8m in 2015 via management fees and other charges.

“We are currently in negotiations with our lenders to obtain debt maturity extensions or restructuring of our debt facilities. We cannot guarantee that we will be able to obtain our lenders consent, with respect to the aforementioned noncompliance under our credit facilities, or any non-compliance with specified financial ratios or financial covenants under future financial obligations we may enter into, or that we will be able to refinance or restructure any such indebtedness,” DryShips noted in its annual report.

If it fails to get support from creditors, DryShips warned: “[W]e could lose our vessels if our lenders foreclose their liens, which could impair our ability to conduct our business and continue as a going concern.”

DryShips suffered a net loss of $2.84bn for 2015.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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