Overseas Shipholding Group obtains approval of exclusivity extension

By Caroline Salls

Pittsburgh, Sept. 24 - Overseas Shipholding Group, Inc. obtained an extension of its exclusive periods for filing and soliciting votes on a plan of reorganization, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

The company's exclusive filing period was extended through Nov. 30 from Aug. 2 and the solicitation period through Jan. 31 from Oct. 1.

As previously reported, administrative agent U.S. Bank asked the court last month to grant a 60-day exclusivity extension, instead of the longer extension requested by the company and approved in Tuesday's order.

In the extension motion, the company said the additional time is needed to allow the Overseas debtors to "continue the claims resolution process to reconcile and fix the more than 1,600 proofs of claim that have been filed against them, including more than $400 million in asserted damages claims from chartered vessels that have been rejected, more than $450 million in claims asserted by the Internal Revenue Service, and thousands of asbestos-related claims."

Overseas Shipholding says it also needs the extension "to negotiate and discuss plan structure and mechanics with their various creditor constituencies, as well as to provide for sufficient financing or other liquidity upon emergence."

U.S. Bank argued that "all obstacles to plan negotiations have been removed in the nine months since these cases were filed," and "the debtors have completed their operational restructuring" and "have prepared long-term business plans" for domestic and international businesses.

The debtors stand in a position to formulate views regarding the enterprise value of the business and the claims to be addressed before moving "quickly and efficiently through plan negotiations," the bank says.

Overseas Shipholding, a New York-based tanker company, filed for bankruptcy on Nov. 14, 2012. The Chapter 11 case number is 12-20000.

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