Reuters: Bankruptcy News: UPDATE 2-Indonesian shipper, creditors reach deal to avert bankruptcy

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UPDATE 2-Indonesian shipper, creditors reach deal to avert bankruptcy Mar 15th 2013, 01:40 Thu Mar 14, 2013 9:40pm EDT (Adds confirmation from company) By Randy Fabi JAKARTA, March 15 (Reuters) - Indonesia's leading oil and gas shipper PT Berlian Laju Tanker reached a deal with creditors to restructure its $1.9 billion debt, averting what could have been one of the country's biggest bankruptcies in years. Once the world's third-largest chemical shipper, the group secured support for its restructuring plan on Thursday, just four days before a court-mandated deadline. "A deal has been reached with 100 percent of secured creditors voting for it," William Shia, head of Asian investments at Berlian Laju creditor Gramercy, told Reuters shortly after the vote. "The next step is for (Berlian Laju) to implement its plan." Berlian Laju late Thursday confirmed a deal had been reached and said details of the restructuring plan would be announced "in due course". A Jakarta court was expected to officially sanction the deal on March 18, it said in a statement. As part of the restructuring plan, the company will have to sell a number of its oil and chemical tankers to pay back some of its debt, said two lawyers representing creditors at the meeting. Before last year's loan default, Berlian Laju managed a fleet of 64 chemical tankers, 13 oil vessels, 16 gas ships and two floating, production, storage and offloading tankers, according to Reuters data. Berlian Laju, which translates into English as Fast Diamond, defaulted on several debt instruments last year after being squeezed between weak freight rates and higher fuel costs in a shipping market struggling through a global downturn. Berlian Laju's problems were compounded by loans it took out to fund its $850 million acquisition of U.S.-based Chembulk at the peak of the shipping market in 2007. The shipping industry splurged on ordering new ships in 2007-08 that are now being delivered just as demand slumped, particularly on once-lucrative oil export routes between the Middle East and Asia. The world's benchmark supertanker export route from the Middle East Gulf to Japan DFRT-ME-JAP has posted daily negative earnings since late January, meaning shipowners are losing money on journeys. The downturn has led shipbuilders and freight groups from Japan to Italy and Germany to go out of business or scramble to renegotiate with creditors. (Additional reporting by Umesh Desai in Hong Kong; Editing by Jason Neely, David Holmes and Richard Pullin) Link this Share this Digg this Email Reprints

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