Stolt-Nielsen sells 7.7 million common shares in private placement

By Jeff Pines

Washington, Jan. 21 - Stolt-Nielsen SA said it agreed to sell 7.7 million common shares for $104 million in a private placement, the company said.

The sale is part of the company's financial restructuring, which the company expects to complete in the first half of this year. Besides the share sale, the restructuring may include asset sales and/or refinancing of outstanding debt.

The shares were priced at $13.50 per share or NOK92.75.

When the sale to institutional investors is complete, the London-based company will have 62.6 million shares outstanding. The net proceeds will be used for repaying maturing debt, working capital and general corporate purposes.

In addition, Stolt-Nielsen may sell another 3 million shares to raise more money.

In December, the company was in talks with its lenders concerning extending the waivers on covenant defaults. The lenders agreed to extend the waivers until May 21. Stolt-Neilsen, a transportation services company for bulk liquids, also intends to pay down $20 million on its $160 million revolver by Feb. 29.

It obtained an extension on repayment through May 21. The waivers give the company more room to breath on its debt-to-tangible-net worth covenant setting the ratio at 2.65 to 1 at Feb. 29.

Stolt Offshore, which the company controls through a 63.5% stake, is planning to raise $150 million through a conditional private placement of $100 million and then a subsequent offering. Stolt-Nielsen holds $50 million of Stolt Offshore's subordinated debt and it has the option of converting the debt into common stock.

After Stolt Offshore completes its offering, Stolt-Neilsen will no longer be the majority shareholder.

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