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DOF Subsea clears debt hurdle

Bondholder group agrees to repayment deferral as new meeting scheduled for crunch vote

DOF Subsea has issued a new summons for a meeting of bondholders next month for a crunch vote on a debt deferral after gaining agreement with a group of lenders.

The Oslo-listed subsea vessel contractor has been seeking to defer a repayment due on Tuesday under its so-called DOFSUB07 bond loan to 20 December this year as it needs more time to hammer out a longer-term refinancing plan with creditors.

A bondholder group representing about a third of this loan had though rejected the proposal on the grounds they had received insufficient information, while only granting an interim deferral of the repayment to 8 November.

However, DOF Subsea stated in an update it had now reached agreement with this group on the format for the process and onward discussions - including a framework for the sharing of information and appointment of professional advisers - and a meeting on Tuesday of DOFSUB07 bondholders voted in favour of the company’s proposal.

The company has now called a full meeting of bondholders on 6 November at which it requires a two-thirds majority for the debt deferral to be approved, failing which the repayment would fall due on 22 November.

DOF Subsea, which is saddled with total debt of Nkr8.7 billion ($949 million), is struggling to meet loan instalments due to a liquidity squeeze as its earnings have been hit by low utilisation and depressed dayrates.

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