Singapore offshore firm Ezra Holdings sought today to ease its beleaguered financial position asking for waivers from bondholders on a number of debt covenants. Admitting it faces “strong headwinds” from low oil prices, overcapacity and poor charter rates, Ezra said in a release to the Singapore Exchange it will offer noteholders S$250 ($180) for every S$250,000 of face amount as early-consent fee by 5 p.m. local time on November 2, and half the fee after that date. Ezra sold S$150m of the April 2018 notes in 2013.
“The sustained downturn in oil company expenditure continues to result in lower industry activity,” Ezra said in the filing. “Declining charter rates and excess capacity have affected the financial performance and fleet utilization of sub-sea and offshore players.”
Ezra joins a growing list of Singapore-listed shipping and offshore firms asking for leniency from creditors – a list that includes Rickmers Maritime and Marco Polo Marine.
Ezra said it will reassess the value of its assets as of August 31, and if necessary, impair or write them down as appropriate. It also admitted it might have to reassess its investment in Kuala Lumpur-listed Perisai Petroleum Teknologi.
Ezra has been highlighted as a potentially high risk offshore firm for months, especially in the wake of the demise of Swiber Holdings, a local oilfield services company, which sought judicial management earlier this year – a move that spooked the local investment community and led to much deliberation over which other offshore-related listed companies in Singapore are in especially weak financial positions.
Commenting on Ezra’s announcement today, Andre Wheeler, Splash’s offshore columnist, said: “Their statement does not appear to address specific measures to correct their dire financial situation, other than to repeat general statements in the past. It should be noted, these statements have not born any fruition to their liquidity turnaround – in fact it has deteriorated further. Furthermore they fail to mention that NYK itself has financial woes and would not appear to be the ‘cash knight in white armour’ as suggested. This would give me little confidence in their ability or capability to turn things around as the actions appear to be taking place in a vacuum.”
