Toisa Limited, an owner of a fleet offshore support vessels, has filed for bankruptcy, citing tough offshore market.
The company said on Monday afternoon that it, together with its 23 affiliated vessel-owning companies filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.
The company said it took the action following a prolonged slump in global oil prices, among other factors, and its effect on its offshore business.
“While the Company would have preferred to complete its financial restructuring out of court, its complex debt structure and dipartite lender group made filing Chapter 11 necessary to provide a single forum for all continuing conversations with lenders,” Toisa said.
Due to its sufficient liquidity, the company said its business operations and relationship with its customers and vendors will not be adversely affected by this proceeding while it works constructively with lenders toward a consensual resolution.
Under Chapter 11 protection, the company’s vendors are afforded “administrative” status for all shipments made, or services provided, subsequent to the filing. As a result, payments for new shipments or services will be made in the ordinary course of business either by the company or one of the Company’s management agents, which are not part of the Chapter 11 filing.
Toisa’s charterers, shippers and receivers of all cargoes carried aboard its vessels (“customers”) are also afforded the aforementioned “administrative” status. As such, they will continue to receive uninterrupted service from the company and the company will perform all of its duties and obligations under its current and future charter parties, the company said on Monday.
The company, through its management agents is, or will be, in contact with many of its customers and vendors, who have pledged to support the company through its reorganization by continuing to perform under normal operations, it said.
Also, Toisa said its customers and vendors have been historically paid by one of the company’s management agents that are outside the Chapter 11 cases and so customers and vendors will be paid amounts due now and in the future without interruption. The company does not need Bankruptcy Court approval for such payments, it said.
Sealion Shipping Ltd., Marine Management Services and Marine Management Bulk Services, Farnham Marine Agency Ltd., Sealion do Brasil Navagacao Ltda., Sealion do Corcovado Navagacao Ltda., and Brokerage & Management Corp. are not part of the Chapter 11 filing and continue to function as normal, without interruption.