Asia/Pacific News
Daiichi Chuo Kisen Kaisha Submits Rehabilitation Plan Ahead of Schedule
Japan-based dry bulk carrier Daiichi Chuo Kisen Kaisha (DCKK) has submitted its rehabilitation plan 14 weeks early to the Tokyo District Court and could receive an injection of JPY2.88 billion ($35 million).
"We submitted the plan ahead of schedule as we were able to execute the investment agreements," the company stated.
Of the funds coming to DCKK, JPY2.49 billion ($22.1 million) is an investment and JPY390 million ($347,000) is a loan, and while the company did not disclose the identities of its investors, IHS Fairplay believes they are Japanese shipbuilders and Ehime-style Japanese family-owned shipowners.
Earlier this month, DCKK was granted a deadline extension for the submission of its rehabilitation plan, to March 31 instead of February 3.
According to a U.S. Chapter 15 filing in September of 2015, DCKK's debt totals $1.47 billion to 596 creditors, including Hyundai Merchant Marine, Navios, Vale, Rio Tinto Shipping, and Pan Ocean; court documents obtained by IHS Fairplay also list Oldendorff Carriers, Imabari Shipbuilding, and Bank of Tokyo Mitsubishi-UFJ as creditors.
The struggling bulker operator, which is the fifth largest shipping company in Japan with 185 vessels, had been growing its fleet despite worsening market conditions after 2008, and it did not begin downsizing until 2012, when it became clear that Chinese demand was not returning.
DCKK and its subsidiary, Star Bulk Carrier Co., SA, will reportedly make a lump sum repayment of debt within two months from the day the rehabilitation plan is approved by the court, and its investors will become its new shareholders.
Voting on whether to accept the plan will take place in April.
DCKK earlier this month announced it had as entered into ¥2.29 billion ($20.3 million) worth of investment agreements with its main creditors, including 14 vessel owners and shipyards.
