Rickmers Maritime has spooked Singapore investors admitting it is close to liquidation unless creditors come to its rescue. The listed shipping trust which focuses on containerships has told creditors it needs to push back a total of $253m of debt. The company admitted it is unable to repay $179.7m of bonds due in March 2017 and the interest and principal on S$100m ($73.3m) of notes due in May 2017.
The company is now negotiating with investors to exchange their debt with S$28m of new perpetual bonds to avoid potential liquidation or judicial management which Rickmers Maritime said in a release to the Singapore Exchange would be “likely to result in zero recovery for noteholders”.
Shipping and offshore stocks have taken a battering on the Singapore Exchange in recent months. Listed oilfield services provider Swiber Holdings sought judicial management at the end of July. Its chief lender, local bank DBS, came in for heavy criticism for continuing to lend Swiber hundreds of millions of dollars in the weeks leading up to its bankruptcy. The same bank, as well as embattled German lender HSH Nordbank, as senior lenders to Rickmers Maritime, agreed to refinance up to $260.2m of Rickmers Maritime loans earlier this month.
Rickmers Maritime has 16 boxships on its books – all panamaxes ranging in size from 3,450 teu to 5,060 teu. Clients include NYK, MOL, Maersk and CMA CGM. Rickmers Group is the lead shareholder in the vehicle with a 34.2% holding. Rates for panamax boxships have fallen off a cliff this year, especially since the opening of the expanded Panama Canal in June. Panamax boxships as young as 13-years-old have been scrapped.
Rickmers Maritime’s share price was down 14.3% in Singapore this afternoon.