Nordic American Offshore (NAO) has reached a comprehensive solution with lenders that extends existing waivers and could result in a new credit facility.
The Norwegian owner of offshore supply vessels (OSVs) will see existing waivers on a $150m lending from DNB Bank and SEB Bank extended through January, according to sources in the finance market.
Subject to certain conditions, there is also the prospect that the outstanding amount drawn under the current facility — about $133m — will be rolled over into a new loan that matures in 2023, the sources said.
Elements of the deal are said to involve a contribution of up to $20m in cash and, separately, vessel assets from two key investors who were not identified.
The two largest shareholders at last reporting were the Scorpio group with 15.9% and Canadian institutional investor Mackenzie Financial Corp with 13.1%.
Scorpio has a privately owned fleet of 13 OSVs.
Scorpio in December made a surprise move on the offshore market, spending $5m to take control of New York-listed NAO, which was founded by Norwegian shipowner Herbjorn Hansson.
The deal saw Scorpio's Emanuele Lauro step in as chairman and chief executive officer, with Hansson leaving the board but remaining a shareholder.
NAO currently owns 10 OSVs operating primarily in the North Sea, where recent market improvements are likely to have helped the ongoing bank discussions.
The cash infusion by key shareholders is said to take the form of an equity line-of-credit, which means money would be injected to keep NAO afloat only as needed, in return for shares. The gradual and conditional infusion is thought to minimize any further dilution in the short term.
If Scorpio's privately owned vessels also come into NAO as part of the deal, the likely effect would be to reduce overall leverage since they are believed to have less debt attached than the current NAO fleet.
Attempts to reach NAO executives for comment were not immediately successful, but sources suggest an announcement of the restructuring package could be imminent.
