American Shipping to raise up to $120 million through private placement

Sharesholder Converto Capital Fund will buy $20 million of shares

By Angela McDaniels

Tacoma, Wash., Dec. 2 - American Shipping Co. ASA plans to pursue a recapitalization that includes a $90 million to $120 million private placement of equity.

The subscription price will be set through a bookbuilding process that was scheduled to close on Dec. 2, according to a company news release.

A subsequent offering will be made to those shareholders that are not invited to participate in the private placement. The subsequent offering is expected to be up to 15% of the amount raised in the private placement.

Converto Capital Fund AS, which is a 19.9% shareholder in the company, will subscribe for $20 million of shares.

The proposed recapitalization will also include the conversion of up to $29 million owed to Converto under a subordinated loan into new share, amendments to the terms of American Shipping ASA's callable PIK senior bonds and an agreement with the company's bank lenders to relax the dividend restrictions.

The private placement, the debt conversion and the subsequent offering are subject to approval at an extraordinary general meeting that is expected to be held on or around Dec. 27.

Arctic Securities and Pareto Securities are acting as the company's financial advisers in connection with the recapitalization.

American Shipping is a shipping company based in Oslo.

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