Havila Shipping disputes lenders’ allegations of default

Norwegian OSV owner and operator Havila Shipping is disputing allegations of default that have been made by three different banks.

As part of Havila’s restructuring deal, three banks and bondholders had planned to have their debt settled by the end of 2024. Alongside this, these banks decided to extend the agreement for another year related to two vessels in operation and four sold vessels.

Within the framework of the restructuring, a cash settlement of NOK499.6m was refinanced through a bond issue. Furthermore, a non-interest-bearing debt of NOK 522.3m was converted into shares.

The three banks, which extended the restructuring agreement last year, are financing the PSV vessel Havila Foresight and the subsea vessel Havila Harmony. Total interest-bearing debt related to these vessels amounts to NOK151.5m and non-interest-bearing debt related to these and four sold vessels amounts to NOK 616.3m.

According to the restructuring agreement, the two vessels will service this debt through 2025, and the remaining interest-bearing debt will be refinanced and settled in cash at the end of 2025, and the remaining non-interest-bearing debt will be converted into shares.

However, the Fosnavåg-based firm said in a filing that it had received a letter on behalf of the three banks that extended the restructuring agreement alleging that the refinancing by taking out bond loans, which were used to redeem the debt of lenders who, according to the agreement, chose settlement at the end of 2024, violates the restructuring agreement.

The remaining lenders claimed that they would be entitled to declare default on the outstanding debt, both interest-bearing and non-interest-bearing, as well as to claim default interest and enforce security.

Havila said it believes there is no default and fully disputed the remaining lenders’ understanding of the restructuring agreement, adding that it would seek legal clarification of the matter if necessary.