Eitzen Maritime to seek bondholder approval for restructuring proposal

By Jennifer Chiou and Caroline Salls

New York, Oct. 4 - Eitzen Maritime Services ASA announced that it will hold Oct. 11 and 12 meetings at which it will ask shareholders and holders of its senior secured callable bonds due 2015, respectively, to vote on its proposed restructuring plan.

The plan includes a new $10 million senior unsecured bond, which, as announced previously, must be pre-committed and underwritten by the bondholders.

On Sept. 16, the company received an offer from Norsk Tillitsmann on behalf of the company's bondholders for a refinancing of the bond loan agreement. Eitzen said at that time that it would attempt to produce a transaction structure that allows its existing shareholders to subscribe for shares on equal terms as the bondholders.

The company is also asking holders to authorize the conversion in full of their bonds, less any amount made in cash, into shares equal to 95% of the company's post-restructuring stock.

As part of the restructuring, the company is also opening the doors for the appointment of new board members if this is requested by the new owners of the company.

Holders are additionally being asked to give the go-ahead for a private placement of shares in an up to NOK 80 million "repair issue" directed toward existing shareholders, according to a release from Norsk Tillitsmann. Proceeds would be used to repay the bonds prior to conversion.

According to a previous release, Norsk Tillitsmann granted an extension of Eitzen's grace period until further notice.

In addition, the company already said it had attracted interest from a potential investor who might, after completing due diligence, make an offer for Eitzen and/or its shares.

The company said in September that its board feels it is in the best interest of all stakeholders to continue the process with this potential investor to see if an offer will materialize that is more attractive than the refinancing offer proposed by the bondholders.

After conversion of the bonds, if no shares are subscribed in the repair issue, bondholders would hold 95% of the share capital and voting rights while existing shareholders would hold the remainder.

Settlement of the new shares was set for Dec. 15.

Carnegie ASA was hired as Eitzen's financial adviser in connection with the potential investment proposal.

Questions may be directed to chief financial officer Andreas Reklev at 47 932 08 886.

Oslo-based Eitzen Maritime Services provides ship supply, ship logistics, crew management and ship brokerage services.

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