RECOVERY RELIANT RESTRUCTURING, Analysis of Hvide Marine, Inc.

by Geoff Uttmark

Hvide Marine emerged from Chapter 11 on December 15, 1999, just 98 days after filing for bankruptcy protection back on September 8th . That no less than 160 separate petitions were filed on behalf of the company and its subsidiaries with nary a single shareholder lawsuit is testimony to expert pre-planning and early and often public disclosure. There was some degree of good luck, if such a term is applicable to a bankruptcy, in that most of Hvide’s bonds and preferred shares were concentrated in the hands of a small number of institutional investors. The reorganization plan had the support of Loomis, Sayles & Co, LP which represented the holders of approximately 63% of the Company’s $300m 8 3/8% Senior Notes and nearly 50% of the Company’s $115m Trust Convertible Preferred Securities. A $300m debtor-in-possession (DIP) credit facility provided by Hvide’s pre-petition bank group, including $241m of “carry-through” debt and $60m in new financing to meet working capital needs, was used to immediately satisfy almost half of the company’s trade payables in cash. This headed off concerns, especially in overseas jurisdictions where the possibility of seizure of vessels was deemed greatest, that Hvide might go into liquidation. Showing initiative throughout the bankruptcy proceeding, rather than abdicating responsibilities to a court-appointed trustee, paid off for Hvide. Both the company’s assets and image as a going concern survived, albeit a bit dented and tarnished.

This is only an excerpt of RECOVERY RELIANT RESTRUCTURING, Analysis of Hvide Marine, Inc.

Content is restricted to subscribers. To continue reading please Log-In or view our subscription options.