MPC Container Ships (MPCC) boss Constantin Baack has revealed his gratitude after the company's refinancing plan was voted through by shareholders on Monday.
The extraordinary general meeting rubber-stamped a private placement of 260m new shares to raise NOK 260m ($27.5m).
Shareholders also gave the board permission to make another 35m new shares available for sale at NOK 1 per share, potentially raising a further $3.5m.
Chief executive Baack said the meeting was the essential final step in the company’s recapitalisation process.
"In the midst of a very challenging environment for the container shipping industry, our employees and business partners have demonstrated a commendable dedication towards MPC Container Ships," he added.
"Moreover, the company has benefited from strong support from shareholders and bondholders in a difficult and unpredictable market. For this, we are grateful."
The company said it could now "fortify the intricate recapitalisation efforts in two of its financial silos most affected by the Covid-19 pandemic".
Sticking to financial guidelines
MPCC added that by "adhering to sound corporate governance principles and offering all shareholders the opportunity to participate", it had been granted the liquidity runway needed to protect its value and pave the way for a recovery after the Covid-19 pandemic.
The cash is needed to prevent covenant breaches and a fire sale of vessels.
MPCC operates small feeder boxships in a market hit by low charter rates and falling asset values.
The company had initially been looking to raise $15m through a share sale.
But MPCC strengthened that offer at the end of June with a plan to add in $27.5m of new common equity, of which $20m will be injected into the company.
This makes the overall plan worth $42m.
The restructuring faced criticism from rebel bondholders who feared the initial scheme favoured shareholders.
Bondholders ultimately voted 77% in favour of the new plan, meeting the two-thirds threshold for approval.
Not dependent on improving market
Fearnley Securities assessed the first plan as balanced and sufficient to create a viable financial runway.
But the Norwegian investment bank said it rested on a "gradually improving market balance" in 2021 and 2022.
Fearnley Securities added that the revised proposal largely removes any dependence on improved charter rates by adding up to $42m of new liquidity versus $27m in the original proposal.
The new plan will also see up to $12m paid in kind with new bonds to bondholders instead of interest, and a $2.5m temporary release of restricted cash.
