Restructuring Slashes TORM Debt, Boosts Fleet

The completion of an extensive restructuring has resulted in TORM slashing its debt, boosting its fleet, and re-emerging as "one of the largest owner-operators of product tankers globally that is poised for growth," the Danish shipping group has announced.

Under the restructuring, TORM employed a lender debt write down to reduce its $1.4 billion debt to $561 million, and the group now has a new undrawn working capital facility of $75 million as well as available cash, and cash equivalent liquidity of over $125 million.

Additionally, Oaktree Capital Management-owned OCM Njord Holdings  S.à.r.l. contributed 25 tankers and six newbuilding product tankers to TORM, which boosts the group's total inventory to 74 owned product tankers, including LR2, LR1, MR, and Handysize classes.

The contribution was the result of Njord Luxco selling its shares in OCM (Gibraltar) Njord Midco Ltd. to TORM.

Flemming Ipsen, chairman of the board for TORM, says these initiatives have enabled his company to create "one of the largest owner-operators of product tankers globally, and we expect TORM to deliver strong, positive financial results already this year after an extended period of financial difficulties."

TORM is expected to post a full-year 2015 EBITDA of between $170-million and $210 million, and a pre-tax profit of between $100 million and $140 million.

Despite its difficulties, TORM earlier this year reported a Q1 2015 profit of $8.6 million, a turnaround from the $222.6 million loss reported in Q1 2014 and the company's first profit in five years.