Eagle Bulk set for Chapter 11

Eagle Bulk is set to file Chapter 11 papers after striking a prepackaged restructuring deal with lenders.

Nasdaq-listed Eagle will see debt cut by almost $1bn in a restructuring that will be overseen in the United States Bankruptcy Court for the Southern District of New York.

Sophocles N. Zoullas will remain as both chairman and chief executive of the reorganized company.

He said: "With an expedited restructuring process now underway, we are pleased to have the ongoing support of our lenders, with whom we will work in partnership to recapitalize Eagle Bulk's balance sheet and significantly reduce the company's debt load."

In an SEC filing, Eagle, which had been operating under a string of waivers, says it has secured 85% support from its lenders for the plan.

New credit lines

Eagle says a new $50m debtor-in-possession facility is in place alongside a $275m exit facility.

The Chapter 11 filings, when it comes, will only involve Eagle Bulk Shipping Inc and not any of its subsidiaries.