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Ultrapetrol skips $16.5m in interest payments while it renegotiates loans

Ultrapetrol says it has decided not to make a payment of $16.5m due today in interest on various loan agreements while it renegotiates with its lenders.

A payment of $10m is today due on Ultrapetrol’s outstanding 8.875% first preferred ship mortgage notes due 2021, and another payment of $6.5m is due on interest and principal payments on loans related to the company’s river business.

“Although the company currently has sufficient liquidity to make the payments, the company believes it is prudent not to do so at this time as negotiations continue with representatives of holders of the notes and with the company’s other secured lenders,” the Nasdaq-listed company stated today.

Ultrapetrol is in discussions with lenders to its subsidiary UP Offshore to refinance its outstanding loan facilities. The company says it hopes to extend the loans’ near-term maturities and amortisation schedules.

Ultrapetrol also wants to restructure certain debt securities with creditors of its river business, with whom discussions are ongoing. For now, the business has enough liquidity to operate normally during the negotiations, the company said.

“Following Petrobras’s cancellation of three PSV contracts in our offshore supply business, we have decided to initiate negotiations with our secured lenders in order to seek a consensual restructuring of our balance sheet,” Damian Scokin, Ultrapetrol’s CEO said in a statement.

“We believe that even under these difficult market conditions, there is ample value in Ultrapetrol’s assets and contracted cash flow to provide an agreeable outcome for all stakeholders.”

Holly Birkett

Holly is Splash's Online Editor and correspondent for the UK and Mediterranean. She has been a maritime journalist since 2010, and has written for and edited several trade publications. She is currently studying for membership of the Institute of Chartered Shipbrokers. In 2013, Holly won the Seahorse Club's Social Media Journalist of the Year award. She is currently based in London.
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