Ultrapetrol’s loan negotiations continue after deadline, share price takes a hit
Ultrapetrol’s 30-day grace period following a missed interest payment has ended, and the NASDAQ-listed company is seeking an extra two months in which to pay up.
On December 15, a payment of $10m was due on Ultrapetrol’s outstanding 8.875% first preferred ship mortgage notes due 2021. Another payment of $6.5m was due on interest and principal payments on loans related to the company’s river business.
“The company is engaged in discussions with representatives of a majority of the noteholders and is seeking a standstill agreement through March 31, 2016,” Ultrapetrol said today.
The company’s share price has taken a hammering today since the news emerged. At the time of writing, the stock has lost 47% of its value since markets opened and is currently trading at $0.051 per share.
Ultrapetrol has, however, signed forbearance agreements with lenders to subsidiaries of its offshore supply business. Tentative forbearance agreements are also awaiting approval from creditors IFC and OFID regarding loans to Ultrapetrol’s river business. Both forbearance agreements would expire on March 31 or as soon as certain obligations are fulfilled.
For now, the lenders who have signed these agreements with Ultrapetrol have agreed not to accelerate the loans or undertake enforcement actions, and to cooperate with the company “in negotiating a sustainable financial structure”.
Ultrapetrol says it believes it has sufficient liquidity “to conduct business as usual” and payments due to employees, vendors, suppliers, and trading counterparties will not be affected by the debt negotiations.
