D'Amato creditors approve debt deal
The creditors' committee for D'Amato di Navigazione, the Italian shipping industry's most high-profile casualty of the economic crisis to date, voted unanimously yesterday to approve an agreement under bankruptcy protection covering the company"s liabilities.
In a statement on the agreement, which covered repayments to creditors of ?110m ($147m), company president Michele d'Amato is quoted as thanking his three children for their efforts in pushing the agreement to a successful conclusion.
Mr d'Amato, a respected elder statesman of the Neapolitan shipping community, suffered a severe stroke shortly before the company's difficulties became public. He is not understood to have played an active part in the discussions on the repayment of creditors.
D'Amato di Navigazione ran into difficulties at the end of 2008 following a wave of defaults by charterers, among them Brittania Bulk, Glory Wealth, Daebo and SW Shipping. SW's default alone is thought to have cost the company $50m.
The extent of its difficulties was revealed in a PricewaterhouseCoopers analysis released by major creditor Deutsche Schiffsbank last June. PwC forecasted that its revenues would shrink dramatically, from $481m in 2008 to $80m last year.
At the same time, PwC said D'Amato's net debt had jumped form $62.1m at end-2007 to $174m at the end of first-quarter 2009. It anticipated a cash-flow deficit of $77.3m for the last nine months of the year.
In mid-2009, the company filed for bankruptcy court protection or ?concordato preventivo? under Italian law. It has since been locked in negotiations with its creditors.
The aim was to pay off its creditors as far as possible through the liquidation of assets, which included four owned ships and contracts for five newbuildings ? a capesize, two panamaxes and two handysize bulkers ? while maintaining the company's ability to continue as a growing concern.
Sources close to the company said it would likely retain ?two or three vessels? once its creditors were satisfied, and that it saw these vessels as a sound base to return to business.