Navios Holdings, Navios Acquisition Axe Loan following Lawsuit
Navios Maritime Holdings Inc. and Navios Maritime Acquisition Corporation have terminated the USD 50 million loan agreement, pursuant to which Navios Acquisition provided a secured revolving loan facility to Navios Holdings in March 2016.
No borrowings had been made under the revolver facility, the companies said.
The move comes in the aftermath of a lawsuit filed by Metropolitan Capital Advisors International, a shareholder in Navios Acquisition.
Namely, Metropolitan, which holds some 234,500 shares in Navios Acquisition along with its founder Jeffrey E. Schwarz, urged the court to block the drawdown of the agreed loan or to seek a return of the any amount paid.
“The Boards of Navios Holdings and Navios Acquisition believe that the process for, and terms of, the revolver were fair, and that litigation challenging it is without merit. However, the Board of Directors of Navios Holdings determined that Navios Holdings does not currently need access to the revolver, and the board of each company determined it was in such company’s best interests to avoid expensive and unnecessary litigation,” a joint statement reads.
Under the terms of the agreement between Navios Maritime and Navios Acquisition, the loan facility was due to be repaid on December 31, 2018, and had an interest rate based on LIBOR plus of 3% per annum.
The loan was expected to be used for general purposes.