Seaspan has pulled out of its proposed plan to invest US$200M in the Swiber Group
Swiber secured equity funding from Seaspan in 2018, with Swiber’s creditors approving a restructuring plan in May 2019 where Seaspan committed to invest US$200M in Swiber subject to conditions being met.
Seaspan was to provide an initial investment of US$10M in exchange for an 80% shareholding interest in a new holding company into which certain assets of the existing Swiber Group would be transferred.
A subsequent payment of US$190M would commence upon Swiber securing the development stage LNG-to-power project in Vietnam worth US$1Bn and achieving project milestones.
Preconditions for the deal related to transferring assets, debt restructuring and the LNG project were not met by the deadline of 31 December 2019. The parties did not discuss extending the deadline thus the equity investment agreement has been terminated.
Singapore-based offshore firm Swiber has been struggling financially since crude oil prices fell in 2014. The capital intensive nature of Swiber’s business meant lenders reduced their exposure in light of the fall in crude prices.
By 2016, failing to secure funding, the company filed winding up proceedings before opting for judicial management. By 2019 Swiber’s debt had ballooned to over US$1Bn.
Swiber has published a statement stating that the judicial managers remained open to considering other restructuring options.