Marine Subsea seeks holder approval to amend 9% bonds due 2019

By Jennifer Chiou

New York, Nov. 21 - Marine Subsea Cyprus Holding Ltd. announced a Nov. 29 meeting in Oslo at which it will look to bondholders to authorize proposed amendments to their 9% bonds due 2019 in connection with the restructuring of the securities.

Marine Subsea AS is the parent guarantor.

In addition to other changes, holders are being asked to waive and release any and all claims against trustee Norsk Tillitsmann,

According to a notice from Norsk Tillitsmann, the company has incorporated a new silent limited partnership under the name Offshore Accommodation IS, with Offshore Accommodation AS as its general partner.

Offshore Accommodation was formed to purchase three offshore barges, and Pareto Project Finance AS has received indicative commitments for $74 million to enable Offshore Accommodation to acquire the barges from certain Marine Subsea Cyprus subsidiaries.

The release stated that Pareto believes that it has exhausted further financing possibilities.

Marine Subsea Cyprus originally proposed that certain of its shares and debt owed by subsidiaries by transferred to a newly formed entity, African Offshore Services AS. The purchase price was to be $90 million in cash.

Fees were estimated at roughly $2 million in addition to a maximum $15 million payment to Jaya Shipbuilding and Engineering Pte. Ltd. for Jaya to release its pledge over the shares of Marine Subsea Worker Pte. and the mortgage covering the African Worker barge.

It was anticipated that holders would receive a cash payment of about $73 million.

In addition, the company has to pay $150,000 per week from the Aug. 31 first summons date until the restructuring is complete. Thus far, the additional amount has accumulated to $1.65 million, which is to be paid to the trustee.

That said, bondholders are being asked to consider the revised restructuring proposal to provide for the $74 million to be paid by Offshore Accommodation for the barges in addition to 40% of the partnership shares, which would be distributed to bondholders.

Based on the revisions, the additional amount will now roughly equal bondholder costs, leaving a cash consideration of about $59 million to be distributed to holders.

Following the payment, the principal amount of the bonds will be reduced by $75 million.

Marine Subsea is also proposing that $16 million of shares be issued to bondholders.

Approval requires a majority vote from a quorum of holders of two-thirds of the bonds.

The company originally issued $246 million of the bonds.

The trustee may be reached mail@trustee.no or by fax to 47 22 87 94 10.

Oslo-based Marine Subsea is an international offshore support company with a main focus in West Africa.

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