Dorian LPG Amends Debt Facility

US-based owner and operator of very large gas carriers (VLGCs) Dorian LPG has entered into an agreement with its lenders to amend certain terms of the company’s debt facility that closed in March 2015.

Banks have agreed to relax certain covenants of the 2015 debt facility and release USD 26.8 million of restricted cash to be applied towards future debt repayments, interest and certain fees.

Following the prepayment, amounts due under the 2015 debt facility are USD 645.4 million, the company said.

“With trade fundamentals continuing to develop favorably in the global LPG market and our continued focus on our chartering policy and managing our costs, we are well positioned for the future. We are grateful to our lending banks for their flexibility and contribution to finalizing this amendment,” John Hadjipateras, Chairman and Chief Executive Officer of Dorian LPG, commented.

“We are pleased to have proactively worked with our banks to secure further financial flexibility for Dorian in a manner that also reduces debt and improves our cash breakeven levels. We believe that this amendment will give us greater potential to build our cash reserves at a low point in the cycle,” Ted Young, Chief Financial Officer of Dorian LPG, added.

Dorian said that out of the USD 26.8 million released to the company, USD 24.8 million will be applied to the next two debt principal payments, thereby reducing the company’s cash breakeven levels by USD 6,176 per calendar day over the next six months. In addition, the company has agreed to recontribute USD 22 million to the restricted cash account over the next 12 months unless it raises USD 50 million of common stock.

If the company completes a USD 50 million common stock offering, limitations related to the company’s ability to declare dividends and repurchase shares of company stock will be eliminated, and the minimum liquidity requirement will be further decreased. In any event, the limitation on dividends and share repurchases will terminate two years from the date hereof, according to Dorian LPG.

Currently, Dorian LPG owns and operates a fleet of 22 VLGCs.