Ezra Seeks Waivers on Bond Covenants Amid ‘Strong Headwinds’

Ezra Seeks Waivers on Bond Covenants Amid ‘Strong Headwinds’

Ezra Holdings Ltd. is seeking waivers from bondholders on some of its debt covenants as the Singapore-listed oil-service provider said it continues to face “strong headwinds” from low oil prices, weak charter rates and industry overcapacity.Ezra started its consent solicitation process on Tuesday, and has scheduled a meeting to consider the proposals on Nov. 9, according to its filing to the Singapore Exchange. It’s offering noteholders S$250 for every S$250,000 of face amount as early-consent fee by 5 p.m. local time on Nov. 2, and half the fee after that date.“The sustained downturn in oil company expenditure continues to result in lower industry activity,” Ezra said in the filing. “Declining charter rates and excess capacity have affected the financial performance and fleet utilization of sub-sea and offshore players.”The slump in oil prices has hurt Singapore, which relies on the marine and offshore industry for about 19 percent of manufacturing jobs. The local-currency bond market has had four default cases involving S$1 billion of bonds. At least eight companies in the shipping and oil and gas services industry, including Rickmers Maritime, Marco Polo Marine Ltd. and AusGroup Ltd., have asked for leniency from creditors on their debt loads.Price SlideEzra sold S$150 million of the April 2018 notes in 2013. The 4.875 percent notes were indicated at about 40 cents on the dollar, according to prices from DBS Bank Ltd. versus 80 cents three months ago. The company’s shares have lost 44 percent in Singapore this year to 5.5 cents.Ezra is seeking bondholders’ consent to waive any breach or potential breach arising from any non-compliance with some financial covenants for the half-year ended February 2016 through April 24, 2018, when its existing debentures mature, according to the filing. The company is…

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