Norway's Solstad Offshore is offering creditors an exit route from the company — at the cost of a big debt haircut.
The restructuring Oslo-listed offshore vessel owner has launched an offer to buy back liabilities totalling NOK 967m ($107m) for up to NOK 69m.
The offer is being made to bondholders and other creditors including John Fredriksen's sale and leaseback company SFL Corp and Sterna Finance.
Solstad will run the offer as a reverse auction, in which it will buy back the debt offered at the lowest price first.
Unnamed creditors have underwritten the full NOK 69m cash pot, for a fee of NOK 1m.
The offer expires on Wednesday.
Arctic Securities has been brought in to run the auction.
Solstad agreed a $2bn restructuring in May that will see banks and bondholders take over all but 0.4% of the company in a $1.1bn debt swap.
But shareholders including Fredriksen, Kjell Inge Rokke and the Solstad family can build their ownership back up to a combined 35% through a new share issue.
This will cost NOK 70m.
Exit route
The buy-back offer will allow these key "industrial" shareholders to retain a little more of their holdings, while giving creditors a way out of owning part of Solstad following the equity conversion.
The remaining debt will be rolled up into a new four-year loan of $886m.
The plan will also see 37 non-core vessels sold, leaving it with a fleet of 90 units.
Solstad has also announced a cooperation agreement with technology company Westcon Power & Automation to further develop environmental and sustainable technologies.
The shipowner and Westcon have already installed green battery hybrid packages on seven vessels, while others can connect to shore power.
The new frame agreement will examine further fuel-reducing methods for the fleet.
Solstad cuts emissions by 20%
"To reach climate-neutral operations by 2050 is an ambitious target," Tor Inge Dale, Solstad's chief operating officer said.
"Year to date we have achieved a decarbonisation of 20% and we are continuously evaluating measures of improvement through our sustainability programme.
"This frame agreement is a stepping stone to reach our target."
The Lars Peder Solstad-led company logged a net loss of NOK 805m in the second quarter, compared with NOK 342.5m in 2019.
The 127 ships brought in revenue of NOK 1.33bn, against NOK 1.37bn a year ago.
The six-month loss is now NOK 3.05bn.
