ASL Marine seeks to amend 4¾% notes due 2017, 5.35% notes due 2018

By Marisa Wong

Morgantown, W.Va., Dec. 29 – ASL Marine Holdings Ltd. announced it launched a consent solicitation to amend its S$100 million 4¾% series 006 notes due 2017 and S$50 million 5.35% series 007 notes due 2018.

The company is asking noteholders to approve a three-year extension of the maturity date, the addition of a call option and mandatory redemption event, amendments to the interest rates, a provision for a form of security to be taken and changes to some financial covenants.

Specifically, the company wants to postpone the maturity date of the series 006 notes to March 28, 2020 from March 28, 2017 and the maturity date of the series 007 notes to Oct. 1, 2021 from Oct. 1, 2018.

The company is proposing to increase the coupon on the series 006 notes to 5½% for the period from the original maturity date to March 28, 2018, 6% from March 28, 2018 to March 28, 2019 and 6½% from March 28, 2019 to the extended maturity date. And the company wants to increase the coupon on the series 007 notes to 5.85% for the period from April 1, 2017 to April 1, 2018, 6.35% from April 1, 2018 to April 1, 2019, 6.85% from April 1, 2019 to April 1, 2020, 7.35% from April 1, 2020 to April 1, 2021 and 7.85% from April 1, 2021 to the extended maturity date.

In addition, the company wants to add a call option during the 12-month period prior to the maturity of the notes.

The company is also proposing a mandatory partial redemption. For each of the interest payment dates from Sept. 28, 2017 to Sept. 28, 2019, the company would redeem S$2.5 million of the series 006 notes, and for each of the interest payment dates from Oct. 1, 2017 to April 1, 2021, the company would redeem S$1.25 million of the series 007 notes.

The financial covenants affected by the proposed changes include those relating to the ratio of consolidated total borrowings to consolidated tangible net worth and the interest coverage ratio.

Noteholders will vote on the proposals at separate meetings to be held on Jan. 20 in Singapore. The meeting for the series 006 notes will be held at 10 p.m. ET on Jan. 19, and the meeting for the series 007 notes will be held at 10:30 p.m. ET on Jan. 19.

Voting instructions must be submitted by 10 a.m. ET on Jan. 17 for the series 006 notes and by 10:30 a.m. ET on Jan. 17 for the series 007 notes.

Holders who deliver voting instructions prior to Jan. 12 (Singapore time) will be eligible to receive an early consent fee of 0.5%. Holders who vote in favor of the proposals but deliver voting instructions after the early deadline will be eligible to receive the normal consent fee of 0.25%. Payment of consent fees is expected to occur on Jan. 26.

The extraordinary resolution presented at each meeting requires a 75% majority of the votes cast in order to pass.

Each meeting requires a quorum of two or more persons holding at least 75% of the principal amount of the applicable notes. If the meeting is adjourned, the quorum will drop to 25% of the outstanding principal amount.

United Overseas Bank Ltd. (+65 6539 2126 / 2132, Project.Spring@UOBgroup.com) is the solicitation agent. Tricor Singapore Pte. Ltd. (+65 6236 3550 / 3555, IS.Corporateactions@sg.tricorglobal.com) is the meeting agent.

The company held an informal meeting with noteholders on Dec. 16 prior to launching the consent solicitation, as previously reported.

Adverse industry conditions have affected the company’s performance in terms of lower revenues, cash and asset values, which has consequently reduced its debt capacity, the company said in a previous announcement.

The series 006 and 007 notes were originally issued under the company’s S$500 million multicurrency debt issuance program.

ASL Marine is a Singapore-based shipping firm.

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