SINGAPORE (Nov 15): A Singapore-listed rig and vessel supplier is seeking court-supervised management to fend off creditors, saying it’s at an impasse with major lenders on a proposed debt restructuring following a bond default last month.

Swissco Holdings said “a significant gap persists between the Group’s aim of sustaining its business in the long term and the position of these lenders,” a filing to the Singapore Exchange late Monday shows. “In the circumstances, the group has decided to file for an interim judicial management order.”

The fallout brings another bout of bad news for bondholders facing an unprecedented wave of defaults following a slump in global energy and shipping markets over the past two years. More than US$400 billion ($566 billion) of proposed energy projects worldwide have been delayed since mid-2014 and pushed into 2017 and beyond, according to consulting firm Wood Mackenzie. Five companies have reneged on $1.1 billion of notes over the past 12 months, according to Bloomberg data.

“The lenders and bondholders are finding it hard to extend the maturity of their debt because there is low visibility on the turnaround prospect,” said Benson Tay, a fixed income analyst in Singapore at iFast Corp., a fund researcher.

$1 billion order
Swissco’s 5.7% notes due April 2018 were indicated at about 25% of face value, versus 70% three months ago, according to prices from DBS Bank. The notes were sold in October 2014, attracting $1 billion of orders from investors, according to Bloomberg data.

Swissco, which owns a fleet of 45 rigs, barges and vessels, defaulted on a $100 million 2018 note on Oct 21, according to Bloomberg data, joining other firms that have missed payments including Swiber Holdings, Perisai Petroleum Teknologi, PT Trikomsel Oke, Pacific Andes Resources Development. At least 10 others including Ezra Holdings, Rickmers Maritime and KrisEnergy are seeking forbearance from creditors.

The Swissco group had a $296 million net loss in the quarter ended Sept 30 due to impairment, according to its exchange filing. It had about $292 million of liabilities on Sept 30, including $256 million of borrowings due within a year, according to Monday’s filing.

Swissco had sought an informal standstill on its repayment obligations and tried to get its lenders to agree on its restructuring plan to no avail, according to a Nov 9 filing. It received a notice from its notes trustee stating that a potential event of default has occurred due to the company’s failure to pay interest due Oct 16, it said last month.