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Prosafe Misses Payment to Cosco

Image: Prosafe SE

Laxman Pai

The largest and most versatile fleet of semi-submersible accommodation vessels in operation worldwide Prosafe SE has missed its final payment to China's Cosco shipyard for the Safe Notos flotel.

Offshore accommodation specialist informed last November that it had re-evaluated its outlook and revised its forecasts resulting in a $341 million write down of assets and consequently a marginalized book equity amid a prolonged downturn and weaker outlook in the North Sea.

Prosafe further informed that although the company had sufficient liquidity until early 2021, it would in light of the market outlook commence discussions with its lenders with a view to ensure sufficient financial flexibility for the longer term.

The discussions with its lenders are ongoing and constructive. Pending conclusions, Prosafe has received consent to defer payments under the $288 million facility from 15 January until 13 February 2020. Other identified defaults in the period have also been temporarily waived under both the $1,300 million and $288 million facilities.

Both measures have been agreed in order temporarily to align the timing of scheduled payments under both facilities and to create stability while a long-term solution and runway is being sought.

"As part of this, the company's final payment of approximately $18.5 million owed and due under the sellers credit to Cosco for the Safe Notos has not been made. This payment is subject to certain contractual subordination and coordination arrangements with the financial lenders, and discussions with Cosco on this payment is ongoing," it said.

The release added: "As at the current time, the process with the creditors remains constructive and although there can be no assurances with respect to the outcome of the ongoing discussions, Prosafe remains hopeful that it will be able to agree a long-term solution in the near term. Pending this, the company continues to operate on a business as usual basis to protect and create value through challenging market conditions."

Jan 14, 2020

 

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