Norway’s Siem gets holder backing to amend NOK 400 million of bonds

By Susanna Moon

Chicago, April 12 – Siem Offshore Inc. obtained holder approval at the meetings held Wednesday to amend its NOK 229 million of its senior bond issue 2013/2018 and NOK 171 million of its senior bond issue 2014/2019.

There were enough holders to form a quorum, and the measures garnered support for 87.06% of the bonds due 2018 and for 95.65% of the bonds due 2019, according to two separate notices by Nordic Trustee ASA.

The company began the solicitation on March 29 to ask for holder approval to amend and extend the two note series at meetings set for April 12 in Oslo.

The issuer was asking to push out the maturity of each bond issue by 2.5 years and to trim the coupon by 75 basis points from March 28 until the respective original maturity of each bond.

After that, the margin will be the blended arithmetic average under the two bond issues less 75 bps.

Specifically, the issuer is looking to extend the bonds due 2018 until Oct. 30, 2020 and to pare the bond spread to 475 bps for the interest period ending April 30, to 400 bps for the period after that ending on the original maturity date and to 382.5 bps after that.

For the bonds due 2019, the bonds would be pushed out until Dec. 28, 2021 and the margin adjusted to 365 bps through the original maturity date and to 382.5 bps after that.

To approve the amendments, bondholders representing at least two-thirds of the voting bonds must vote in favor. To form a quorum, at least half of the voting bonds must be represented at the meeting.

As noted on April 11, Siem also is now offering to purchase NOK 229 million of its senior bond issue 2013/2018 and NOK 171 million of its senior bond issue 2014/2019.

Siem amended the terms of the offer for the two note series based on holder feedback, the company noted.

The company is offering to acquire the bonds at a price of 72% of par for the notes due 2018 and at 69% of par for the bonds due 2019 as well as accrued interest.

The amended offer will remain open until 3 p.m. ET on April 19, with settlement set for April 24.

Originally, Siem also was seeking to carry out a rights issue for at least NOK 190 million of shares and to extend its $60 million revolving credit facility.

Interest on the notes would be payable in kind as long as interest is also payable in kind on the revolver.

In return for concessions, the company will turn over to holders the right to repayment of the outstanding amount under revolver at par if it defaults on the bonds.

The issuer also would establish a dollar tranche under each issue, subject to a minimum conversion of $20 million. Holders would then have a one-time right to convert their bonds into the issue with a separate ISIN for the dollar tranche with the same margin but one using Libor.

The exchange offer would be carried out as a tap issue.

The bonds also would be amended as follows:

• No dividends, distributions or interest payments on shareholder loans except the revolver;

• No group debt or new liens or securities other than those permitted;

• Value adjusted equity ratio will be reduced to 20% from 30% and amended so as to include excess value of shares subsidiaries; and

• Issuer will be given a call option at par.

In the revised offer, if the cap is not reached for one issue, then the offer for the other issue will be increased by an amount equal to the shortfall, the release noted.

The offer is contingent on bondholder approval of the amendments at the meeting April 12, which has now been satisfied.

Swedbank (+47 23 11 62 63 or alexander.furuheim@swedbank.no) is the receiving agent.

Siem Offshore serves the global oil and gas industry and is based in Kristiansand, Norway.

© 2015 Prospect News.
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