Quantcast
Channel: Fossil Energy - Offshore Energy
Viewing all articles
Browse latest Browse all 7942

Siem Offshore gets breathing room after standstill deal with lenders

$
0
0

Norwegian shipping company Siem Offshore has found a way to improve its cash flow and liquidity to be able to operate in a challenging offshore market by entering into a standstill agreement with its lenders.

Siem Offshore on 26 May 2020 entered into an agreement with the group’s secured lenders in Europe and Norway for a standstill agreement for the period from 29 May 2020 until 30 April 2021.

The terms of the agreement include a 100 per cent deferral of principal and interest until the end of the standstill period. The agreement also includes a waiver of financial covenants, including loan-to-value provisions.

The company added it has similar discussions ongoing with the secured lenders in Brazil and Canada, and the standstill agreement is conditional on agreement with these banks.

The standstill agreement is further conditional upon reaching an agreement with the bondholders of the NOK350 million senior unsecured bond (SIOFF01) due 30 October 2020 and the NOK760 million senior unsecured convertible bond (SIOFF02) due 4 November 2023, to defer payments and suspend acceleration rights until the expiry of the deferral period on 30 April 2021.

According to Siem, the standstill agreement will improve its cash flow and liquidity and secure sufficient cash to operate the fleet in a challenging offshore market with possible downtime caused by COVID-19, during the next 11 months.

The intention is for the company and its lenders to use the standstill period to agree on a long-term plan to take the company through the prolonged downturn and preserve the earnings capability to allow for the repayment of debt when the market recovers.

When it comes to its financial performance, Siem in 1Q 2020 recorded operating revenues of $52.8 million, a decrease compared to $69.3 million in the same period last year.

The company’s net loss was $23.8 million compared to $24.1 million in 1Q 2019.

Upon the release of its financial report earlier in May, Siem said it was bracing itself for a downturn probably worse than the one experienced during the past few years.

Photo by Alan Jamieson – shared with permission from the author

The post Siem Offshore gets breathing room after standstill deal with lenders appeared first on Offshore Energy.


Viewing all articles
Browse latest Browse all 7942

Trending Articles



<script src="https://jsc.adskeeper.com/r/s/rssing.com.1596347.js" async> </script>