2007

Svithoid Tankers AB “Tap” Issue

Last week, Nordea Bank announced the issuance of a tap or second tranche (NOK 25 million) of the Svithoid Tankers June 2009 bond issue. Nicolai Friis, who led the origination, described the “tap” as a means of quickly and efficiently raising additional capital in the high yield market. A tap issue is when an already existing bond is enlarged. In this case, Svithoid, with the help of Nordea raised the amount of the original bond, which had a borrowing limit of NOK 200 million, by NOK 25 million to NOK 175 million in total. With an existing loan agreement and the trustee already in place, all that was needed was a one-page addendum. A description of the key features of the transaction is included in the Guts of the Deal.

Svithoid Tankers is a Swedish shipping company which focuses on smaller modern product and chemical markets that operate in Northern Europe within the two sub-markets of 1,800 to 5,000 DWT (Northern European coastal tankers) and 5,000 to 10,000 DWT (distribution of petroleum products in the Baltic region). At present, the fleet consists of seven vessels in regular service and seven newbuildings with expected delivery during 2007 and 2008. All the vessels, including the newbuildings, are employed on long-term contracts, typically averaging five years, to industrial customers.

This is only an excerpt of Company News – 03/29/2007

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