Chapter 11 Sea Containers supports UK funds
UK - Sea Containers has said it has made financial support arrangements for two of its UK group pension schemes, as part of the company's attempt to exit its Chapter 11 proceedings.
The Bermuda-registered transportation company announced its restructuring plan last week, saying it had completed the transfer the interest in its container leasing business - including its joint venture with GE, to a new Bermuda registered company named SeaCo.
SeaCo's major shareholders are its creditors, the Sea Containers 1983 Pension Scheme and the Sea Containers 1990 Pension Scheme, alongside with the former Sea Containers Ltd bondholders.
The UK Pensions Regulator (tPR) has approved the has approved the arrangements, said Sacker & Partner, which advised the trustees of the 1983 scheme.
The first ever Financial Support Direction (FSD) made by tPR was imposed on Sea Containers after a contested hearing in June 2007.
The arrangements proposed by Sea Containers to satisfy the FSD were subsequently unsuccessfully challenged in the US Bankruptcy Court by other creditors.
The company said that SeaCo has raised a $127m five year exit financing facilty via a senior secured term loan from Fortis Bank Nederland and DVB Bank.
"The proceeds [...] have been used to repay the debtor in possession (DIP) loan provided to Sea Containers Ltd by Mariner and Dune, two of its former bondholders," said the company in an official announcement.
It added the $24m balance of the DIP loan of $141m was repaid from Sea Container's own cash resources.
SeaCo paid $462.3m for the container assets of Sea Containers, including cash of $77.7m and equity of $384.6m.
In addition, SeaCo has advanced $40M as a senior, secured loan, to be repaid in due course from cash generated from the wind down and liquidation of the Sea
If you have any comments you would like to add to this or any other story, contact Carolyn Bandel on + 44 (0)20 7261 4622 or email email@example.com