Struggling Oslo-listed Havila Shipping has entered into an agreement with its secured and unsecured bank lenders to reduce amortisation for three years, postpone maturities and replace all existing covenants, subject to bondholder approval and a minimum NOK 200m ($22.53m) equity issue.
“The downturn in the offshore market has, as for other major players in the sector, had a significant impact on the company,” Havila said in a statement, adding: “The market for offshore vessels is characterised by supply far exceeding demand. As a consequence of low fleet utilisation and rates achieved, many vessels in this segment have generated revenues below operating expenses. Further, vessel valuations are expected in general to extend its decline.”
Havila said it foresees severe financial challenges for the period 2016-2018, hence its moves today to create what it described as a “sufficient liquidity buffer” to operate through 2018 despite the current downturn.
In September Havila was forced to lay up two AHTS vessels and as a consequence had to give notice to some employees within the company as well as reduce crew hiring.
In another blow for Havila, whose offshore support fleet numbers 27 ships, Petrobras has just terminated the contract for Havila Princess. The terminated contract was valid until September 2017.
