OSG almost out
Overseas Shipholding Group's reorgansation plan was approved today by a US bankruptcy judge in Delaware, some 20 months after it filed for Chapter 11 protection, an OSG official confirms.
OSG, which had been the largest tanker company in the US, is expected to formally emerge from bankruptcy protection sometime in August. The plan was confirmed Friday morning by US bankruptcy judge Peter Walsh.
The plan sees equity holders encompassing hedge funds and other financial firms come away with majority holding in the New York-based company, which at least for now will continue to operate both an international and a US Jones Act fleet under the same umbrella.
In addition, the former New York Stock Exchange-listed company is receiving $1.3bn in exit financing from a bank consortium led by New York-based Jefferies.
OSG in May switched from an earlier reorganisation plan that would have given holders of senior debt 97% of the revamped company.
OSG in November 2012 filed for bankruptcy after it could not bridge the gap between an expiring $1.5bn credit facility and a new $950m lending. It was wounded by a prolonged slump in tanker hire rates and a previously undisclosed back-tax obligation to the Internal Revenue Service.
OSG was at the time led by chief executive Morten Arntzen. Arntzen resigned shortly after the Chapter 11 filing, handing the reigns to veteran OSG executive Robert E Johnston.