A restructuring agreement has been signed by the board of DS Torm, the listed Danish product tanker and dry bulk shipping group and Oaktree Capital Management and lenders holding in aggregate 92% of Torm’s existing loan facilities by value.
“Torm is confident that the company will achieve the support of substantially all of its lenders under the existing loan facilities for the implementation of the restructuring,” the company said in a statement.
However, in the case that less than 100% support is achieved, the company will implement the restructuring through an English law scheme of arrangement. This is possible because Torm has already obtained the required minimum lender consent of 75% by value and a majority in number of the relevant classes of its lenders who attend and vote at any such scheme meeting.
“The final implementation of the restructuring would be subject to certain conditions precedent, including required approvals from public authorities,” Torm said.
This is the second debt to equity restructuring programme the company has concluded since the financial crisis in 2008. That left existing shareholders in the company with about 10% of the shares in it.
The current restructuring programme would leave them with 1% to 2% of the shares in the company. Torm will also exit the dry bulk business as part of the current programme.