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PIL squelches bankruptcy rumours after US$1 billion asset sell-off
来源：shippingazette.com 编辑：编辑部 发布：2020/04/21 10:13:04
SINGAPORE's Pacific International Lines (PIL), ranked 10th in world container carrier, has issued a statement to dismiss 'rumours' and 'false claims' that it faces bankruptcy.
PIL managing director Teo Siong Seng Teo said it sold six 12,000 TEU box ships to Seaspan and Wan Hai, which was announced in March, at a price "above book valuations".
A string of divestment deals in recent months that have earned US$1 billion were not driven by a need to reduce debt, he said, but to rationalise the family-owned portfolio in the light of unfolding unfavourable macroeconomic forces, according to Mr Teo, reported London's Lloyd's List.
PIL has sold factories run by its Hong Kong-listed subsidiary, Singamas. It has also sold its controlling stake in Pacific Direct Line and a dozen vessels over the past 16 months.
However, Mr Teo did admit some of the funds would be used to pay down outstanding debt.
This comes amid reports that the carrier has chalked up large bunker bills, leading up to the arrest of a vessel on its fleet in January by one affected supplier. The market has come to link its recent divestments and troubled relations with bunker suppliers with a developing cash crunch.
"PIL would like to clarify that these rumours are totally false and the information and content derived therefrom are unfounded," it said.
It said that it and its subsidiaries in China "have fully resumed operations" and that the company "has been making steady progress and is currently actively preparing for a strong rebound after the epidemic."
"In the face of an increasingly complex and uncertain global market environment, PIL has remained resilient by embarking on a service rationalisation which will focus our efforts on key liner markets in Asia, the Middle East, Africa, Oceania and South America," said the company statement.
"Our strategic business integration has enabled us to be well-positioned in capturing market opportunities brought about by the Belt and Road Initiative, and moving forward, PIL will continue to strengthen our leading position in the north-south route," it said.
Including these vessels, PIL has sold seven of a dozen of 12,000 TEU series of ships delivered from YZJ plus three others this year. This followed on from the sale of about half a dozen smaller vessels the year before.
Mr Teo explained that a decision was made to withdraw from the transpacific trade early this year, leading to the sale of tonnage - including some 12,000-TEU units - plying this east-west trade.
"We believe the north-south and south-south trades would be more robust compared to the long-haul transpacific and Asia-Europe trades," Mr Teo said.
PIL has retained five 12,000-TEU ships, four of these are still trading in the Red Sea and one other plying services lined for Africa.
The shipping group had $4.9 billion of liabilities and in excess of $351 million cash and short-term deposits on its books as of June 30, 2019.
It owed $680 million to trade creditors and ran up $1.14 million in financial leases prior to the sale of the seven 12,000-TEU container ships.FAXTEXT = PIL's trade credit woes mounted when "bunker prices shot up dramatically" at the start of this year, causing the group to "exhaust" credit limits and chalk up outstanding bills, Mr Teo said.
PIL managing director Teo Siong Seng Teo said it sold six 12,000 TEU box ships to Seaspan and Wan Hai, which was announced in March, at a price "above book valuations".
A string of divestment deals in recent months that have earned US$1 billion were not driven by a need to reduce debt, he said, but to rationalise the family-owned portfolio in the light of unfolding unfavourable macroeconomic forces, according to Mr Teo, reported London's Lloyd's List.
PIL has sold factories run by its Hong Kong-listed subsidiary, Singamas. It has also sold its controlling stake in Pacific Direct Line and a dozen vessels over the past 16 months.
However, Mr Teo did admit some of the funds would be used to pay down outstanding debt.
This comes amid reports that the carrier has chalked up large bunker bills, leading up to the arrest of a vessel on its fleet in January by one affected supplier. The market has come to link its recent divestments and troubled relations with bunker suppliers with a developing cash crunch.
"PIL would like to clarify that these rumours are totally false and the information and content derived therefrom are unfounded," it said.
It said that it and its subsidiaries in China "have fully resumed operations" and that the company "has been making steady progress and is currently actively preparing for a strong rebound after the epidemic."
"In the face of an increasingly complex and uncertain global market environment, PIL has remained resilient by embarking on a service rationalisation which will focus our efforts on key liner markets in Asia, the Middle East, Africa, Oceania and South America," said the company statement.
"Our strategic business integration has enabled us to be well-positioned in capturing market opportunities brought about by the Belt and Road Initiative, and moving forward, PIL will continue to strengthen our leading position in the north-south route," it said.
Including these vessels, PIL has sold seven of a dozen of 12,000 TEU series of ships delivered from YZJ plus three others this year. This followed on from the sale of about half a dozen smaller vessels the year before.
Mr Teo explained that a decision was made to withdraw from the transpacific trade early this year, leading to the sale of tonnage - including some 12,000-TEU units - plying this east-west trade.
"We believe the north-south and south-south trades would be more robust compared to the long-haul transpacific and Asia-Europe trades," Mr Teo said.
PIL has retained five 12,000-TEU ships, four of these are still trading in the Red Sea and one other plying services lined for Africa.
The shipping group had $4.9 billion of liabilities and in excess of $351 million cash and short-term deposits on its books as of June 30, 2019.
It owed $680 million to trade creditors and ran up $1.14 million in financial leases prior to the sale of the seven 12,000-TEU container ships.FAXTEXT = PIL's trade credit woes mounted when "bunker prices shot up dramatically" at the start of this year, causing the group to "exhaust" credit limits and chalk up outstanding bills, Mr Teo said.