Pacific International Lines (PIL) has continued to sell assets, even after a Singapore court approved its debt restructuring plan, with four more container-carrying multi-purpose ships sold to Germany’s Briese Schiffahrts, owner of BBC Chartering.
[s2If is_user_logged_in()]The ships are Kota Bangga, Kota Bagus, Kota Bakat, Kota Bakti, all built by Dalian Shipbuilding Industry between 2011 and 2012. Each vessel can carry approximately 1,500TEU. Ship brokers reported the sales two weeks after the Singapore High Court sanctioned PIL’s debt restructuring on 3 March 2021.
Just before the court hearing, brokers stated that PIL had sold the 2012-built Kota Bayu, a sister ship to the vessels mentioned above, to Briese. Sale prices were undisclosed, but the ships are valued at around US$19 million each. VesselsValue indicated the sales were concluded in December 2020, but the ships gradually left PIL’s fleet from late February 2021.
The Singaporean operator’s bond holders voted accepted the company’s proposal to convert the bonds to perpetual securities, on 1 February. The debt restructuring, referred to as a scheme of arrangement, entails converting bonds to perpetual securities, but cash payments will accrue for five years before being released to bond holders.
PIL’s debt struggles, eventually saw the carrier turn to Heliconia Capital, a unit of the Singapore Government’s investment company Temasek Holdings, which granted PIL a US$112 million emergency facility in July 2020. That loan was repaid, and Heliconia agreed to a second tranche of US$600 million, comprising debt and equity investment.
With the restructuring progressing, Heliconia will offer another US$200 million revolving credit facility for drawdown. Amounts drawn down under this facility will need to be replenished in the following years by the company.
PIL offloaded assets throughout 2020, including its subsidiary Pacific Direct Line, while it also ended its operations on the Pacific trades in early 2020. Twenty-one ships were sold in 2020.
Martina Li
Asia Correspondent
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