TORM enters into an agreement with a group of its lenders and Oaktree Capital Management regarding a possible restructuring of TORM


With reference to company announcement no. 15 dated 29 September 2014, TORM has today entered into an agreement with a group of its current lenders, representing 61% of TORM’s ship financing, and Oaktree Capital Management (Oaktree) regarding a possible restructuring of TORM.                                                     

The final terms of the proposed transactions to implement a restructuring of TORM will be subject to further negotiations between the relevant parties. At this stage, the restructuring is expected to stipulate that the lenders will initially write down the debt to the current asset values in exchange for warrants and may elect to convert part of the remaining debt into new equity in the Company. Oaktree would contribute product tanker vessels in exchange for a controlling equity stake in the combined Company, which will reinforce TORM’s position as one of the largest owners in the product tanker segment. The agreement also envisages a new working capital facility.

It is expected that the restructuring will result in a substantial dilution of the existing shareholders in TORM. The consequences of the restructuring will be presented to the shareholders when the proposed implementation structure is agreed upon.

The final implementation of any restructuring would be subject to stakeholder approvals and certain conditions precedent, including required approvals from public authorities.

TORM, the group of lenders and Oaktree will work together to agree on the final terms and implement the proposed restructuring, including soliciting support from the current shareholders and the broader lender group. TORM expects to be able to present the final restructuring plan and transaction structure no later than first quarter of 2015. Further announcements will be made at the appropriate time.  

 
Contact TORM A/S
Flemming Ipsen, Chairman, tel.: +45 3917 9200
Jacob Meldgaard, CEO, tel.: +45 3917 9200
Christian Søgaard-Christensen, IR, tel.: +45 3076 1288
   
Tuborg Havnevej 18
DK-2900 Hellerup, Denmark
Tel.: +45 3917 9200 / Fax: +45 3917 9393
www.torm.com

Safe Harbor statements as to the future
Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and statements other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although TORM believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, TORM cannot guarantee that it will achieve or accomplish these expectations, beliefs or projections.

Forward-looking statements in this company announcement reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and statements other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, the Company cannot guarantee that it will achieve or accomplish these expectations, beliefs or projections.

Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward- looking statements include the strength of the world economy and currencies, changes in charter hire rates and vessel values, changes in demand for “tonne miles” of oil carried by oil tankers, the effect of changes in OPEC’s petroleum production levels and worldwide oil consumption and storage, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry-docking, changes in TORM’s operating expenses, including bunker prices, dry-docking and insurance costs, changes in the regulation of shipping operations, including requirements for double hull tankers or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Forward-looking statements are based on management’s current evaluation, and TORM is only under an obligation to update and change the listed expectations to the extent required by law.

 


Attachments

16-2014-TORM enters into an agreement - UK - Final.pdf