EMEA News
Western Bulk Completes Sale of its Chartering Business, But Survival in Question
Western Bulk ASA (Western Bulk) Monday announced it has begun the sale of its chartering business subsidiary, Western Bulk Chartering, to Kristefos Equity Operations AS (Kristefos) in an accelerated sale process, having received the first cash payment of $10 million from Kristefos
The rest of the cash purchase price, $6 million, will be paid March 2, 2016.
The purchase also includes the company's debt, which will be transferred once the sale is formally approved at a bondholder meeting expected to take place February 22, 2016.
The remaining Western Bulk entity has been renamed Bulk Invest ASA (Bulk Invest), but its ongoing survival is in question.
"The Company will initiate dialogue with its creditors to explore and pursue potential solutions. If no acceptable solution to the Company with the remaining creditors is achieved, the basis of the Company's continued operations will be reassessed," the company said.
"The board of directors of the Company will regardless diligently and continuously evaluate whether the basis for continued operations exists."
The company notes that, as announced last November, it was hoping to raise funds through a rights offering and at the time said that Kistefos had provided "an unconditional and irrevocable subscription and guarantee undertaking for USD 10 million of the contemplated equity capital increase."
However Western Bulk says Kistefos AS has informed it that given the current circumstances, it considers that its subscription and guarantee undertaking no longer applies.
Western Bulk says it is considering its legal position in the matter.
Last week Ship & Bunker reported Western Bulk Chartering had announced its intention to sell off its chartering business.
