Western Bulk seeks OK to change clauses under unsecured bonds due 2017

By Toni Weeks

San Luis Obispo, Calif., July 3 – Western Bulk ASA will call a meeting for holders of its NOK 300 million of floating-rate senior unsecured bonds due 2017, according to a notice by trustee Nordic Trustee ASA. The meeting will be held on July 17 in Oslo.

The bonds were issued in April 2013, with the proceeds designated for general corporate purposes. The following October, the company carried out its initial public offering of shares, and co-investments with the main shareholder were divested and replaced with cash.

The company said that because it significantly improved its cash position and equity following the bond issue, it would like to make changes to clauses in the bond agreement to reduce administrative costs and enhance trading and the value of the shares.

As part of the process of going to a publicly traded company from a privately owned company, Western Bulk is proposing to

• Change to a quarterly dividend policy from a semiannual one;

• Establish a separate $10 million carve-out for share buybacks;

• Remove the requirements for limited audited review of interim accounts in connection with dividends; and

• Change to quarterly reporting from semiannual and remove the requirement to issue unconsolidated accounts at the issuer level on an interim basis.

Western Bulk will offer a one-time amendment fee of 1% of the principal amount if the proposed changes are accepted by the bondholders.

The company said it believes that the proposed amendments will enhance its value and financial flexibility, which will further benefit bondholders. It also said it is balancing bondholders’ interests, as the share buyback is less than the equity increase that was carried out in connection with its IPO.

To approve the resolutions, bondholders representing at least two-thirds of the bonds represented in person or by proxy at the meeting must vote in favor of the resolution. In order to obtain a quorum, at least half of the voting bonds must be represented at the meeting.

According to Western Bulk, it has already received support for the proposal from the majority of the bondholders.

Questions may be directed to the financial adviser, Pareto Securities AS (+47 22 87 87 70).

The global dry bulk shipping company is based in Oslo.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.