Bloomberg News

Sevan Marine Board Says Has Solution to Avoid Bankruptcy

September 29, 2011

(Updates with company statement in second paragraph.)

Sept. 29 (Bloomberg) -- Sevan Marine ASA, the Norwegian maker of floating oil-production and storage vessels, has approved a long-term solution presented to the company to stave off bankruptcy.

The solution will include sustainable collaboration with a “large industrial partner,” the company said in the statement. “The board believes it has found a good solution for all parties. The company will publish further information once the agreement has been approved by all parties.”

The company requested the Oslo Stock Exchange extend a suspension of its shares as it meets with stakeholders for a negotiated settlement that may include a complete restructuring of bond loans, the company said earlier today in a statement.

“There have been tense moments over the last 24 hours,” Chairman Jens Ulltveit-Moe said by phone on his way to today’s board meeting. “It could be very helpful for the company to have a long-term industrial owner as opposed to straight financial ones.”

The company has struggled with larger-than-expected maintenance costs on its Sevan Voyageur production and storage vessel, which are expected to reach $190 million, compared with an earlier $135 million forecast.

The company reached an agreement with bondholders in July to defer interest payments until the end of September as it negotiates a debt restructuring.

--Editor: Jonas Bergman, Stephen Cunningham

To contact the reporter on this story: Stephen Treloar at streloar1@bloomberg.net

To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net


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