Viking Supply Ships breaches covenants - seeking solutions with lendersCompany News // March 1, 2016
Viking Supply Ships, which specialises in operating ice-class offshore vessels, says market conditions have continued to have a negatively affect its earnings and financial position of the group. The company says its liquidity position is "strained" and, in the current market, the group is unable to fulfil existing covenant undertakings in its loan agreements.
"A solution with the group’s lenders is necessary and accordingly, in the fourth quarter of 2015 the group initiated a dialogue with its lenders, with the aim of securing a long-term, stable financing solution by the end of the first quarter of 2016.
"The group remains in constructive dialogue with its lenders to find a viable long term financing solution," said the company in a statement. "As part of this dialogue, Viking Supply Ship's majority shareholder, Kistefos AS, has informed the banks of its intention to support an equity issue of US$15 million. As the company is in breach with loan to value clauses and contract coverage clauses all borrowings are classified as 'short-term' even though the company has entered into a standstill agreement with the banks."