Metro Exploration gets unanimous holder votes to amend bonds due 2016

By Susanna Moon

Chicago, June 7 – Metro Exploration Holding Corp. said it garnered holder support to amend its senior secured callable bonds due 2016 at a meeting held Tuesday in Oslo.

There were enough holders to form a quorum, and the measure obtained 100% of the votes cast, according to a notice by Nordic Trustee ASA.

Metro proposed the following amendments, according to a separate company announcement:

• Transfer the shares in Metro Drilling Holding Corp. from NT Refectio XIII AS to Towerview Purpose Trust;

• Limit the recourse on the remaining outstanding bonds and coupon claims following a final payment to bondholders;

• Deregister the outstanding bonds and authorize a discharge; and

• Approve payment of a restructuring fee to the financial adviser AMA.

The bondholders meeting was requested by the issuer and bondholders representing more than one-tenth of the voting bonds.

The backdrop to the changes that were proposed is the challenging oil and oil services industry, particularly in the drilling segment, which has hurt asset values, the company noted.

The shares in Metro Drilling Holding Corp., the sole shareholder of Metro Ex, have been transferred to NT Refectio XIII AS, a Norwegian special purpose vehicle under the control of the bond trustee. Metro Ex is a holding company, with no business activity or assets other than a 60% ownership interest in Deep Sea Metro Ltd., which has two wholly owned subsidiaries: Chloe Marine Corp. Ltd., the owner of the drillship Deepsea Metro II, and Golden Close Maritime Corp. Ltd., the owner of the drillship Deepsea Metro I.

The company said that it was “unlikely under the current market conditions that the issuer will get additional distributions from Deep Sea Metro” but that it would not discharge the bonds at this point to try to ensure that bondholders could participate in any potential value as a result of the issuer’s indirect ownership of Golden Close.

The bond agreement will be amended so that the issuer will only be obliged to make payments on the remaining outstanding bonds and coupon claims in an amount corresponding to any amounts actually received by it and only to the extent exceeding the retained amounts, the company said.

“Due to poor coverage prospects following the interim payment the bonds will be removed from the VPS records and the ISINs will be deleted to avoid future costs to the paying agent,” the release noted.

The company said that because of the bond deregistration, it will not be possible to summon future bondholder meetings.

The bonds were issued in 2014.

Metro is a drillship company based in Liberia.

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