OSG's $3.2bn bill

US tanker owner OSG has revealed how it will spend $3.19bn of cash to exit bankruptcy.

In an SEC filing, the company said it will have $1.51bn available from a rights issue, plus $1.2bn from two new loans and $481m of cash from its balance sheet.

The biggest bill it has to settle is for debts and interest of $2.3bn, following by $292m of charter rejection claims.

Then it will have to pay the US taxman $270m and $144m for employee/professional fees and contingencies.

Other amounts to be handed over include $40m on newbuildings and vessel conversions, plus $40m in transaction fees.

In a boost to the shipowner, Moody's assigned its new loans a B1 rating.

"The favorable fundamentals of the US Jones Act market support the ratings assignment," it said.

It believes that the good conditions will continue, even when newly-built Jones Act product tankers begin to enter the market in 2016 and as incremental barge capacity enters the fleet in upcoming years.

Last month, OSG revised its restructuring, ditching a previously favoured pact with its lenders in favour of a competing proposal from equity holders.

The lender plan originally backed by OSG would have seen holders of the company’s senior debt - now mostly hedge funds - come away with 97% of the equity in the reorganised company.

Equity holders were relegated to a total recovery of $61m, which one analyst calculated to be worth about $2 per share.

The equity-holders plan features a larger commitment from US bank Jefferies: a $600m term loan secured by OSG’s US-flag fleet, a $600m term loan secured by its international fleet, and a $75m revolving loan for each unit designed to provide working capital upon exit from Chapter 11.

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