Mercator Lines Seeks Financial Assistance
Singapore-based dry bulk shipping company Mercator Lines said it has appointed an independent financial advisor to assist it in assessing the impact of the downturn of the dry bulk market.
The company is already looking into the effects of the market’s deterioration that has seen a reduction in freight rates and further declines in dry bulk asset values.
Concerned about how this may impact the company’s cash flows, financial position and certain covenants under loan facilities, Mercator said it would seek financial advice on options that would keep the company afloat.
“The company has appointed an independent financial advisor to assist with an assessment of its financial position and to advise and assist, as appropriate, with the options available to the company with respect to its financial affairs,” the release read.
The company reported a net loss of USD 20.9 million for 9M FY 2015 as against a loss of USD 15.4 million in the corresponding period from the previous year.
Shalabh Mittal, Managing Director and CEO of Mercator, said in January that the company was considering various options to strengthen its financial position in light of the current challenging dry bulk markets. Strategic alternatives being considered include raising of capital in the form of debt, bonds and/or equity.
The company operates a fleet of 14 bulk carriers, comprising of thirteen owned and one chartered-in vessel, with an aggregate fleet capacity of about 1.1 million dwt and an average age of about nine years.