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Seaspan Corporation Message Board

  • mkyhhd mkyhhd Sep 22, 2009 10:42 PM Flag

    Danaos says charterer to cut payments

    -Danaos says charterer to cut payments, shares down
    Tue Sep 22, 2009 5:52pm EDT

    * Charterer plans to unilaterally cut payments by 35 pct

    * Says rejects charterer's offer, holding talks

    * Gets covenant waivers until Oct. 1, 2010

    * Shares down 9 pct in after-hours trade

    Sept 22 (Reuters) - Container shipping company Danaos Corp (DAC.N: Quote, Profile, Research, Stock Buzz) said one of its charterers has unilaterally decided to cut all of its long-term charterhire payments to ship owners by 35 percent, sending its shares down as much as 9 percent.

    Danaos said it has not accepted the offer by the charterer Zim Integrated Shipping Services Ltd, which is commencing the payment cut on Sept. 1 for three years.

    The six containerships that Danaos charters to Zim are currently operating under 12-year time charters, the company said, adding that it is in discussions with the charterer.

    Danaos added that it has now obtained waivers covering all prior breaches of financial covenants in its credit facilities as well as any subsequent breaches until Oct. 1, 2010.

    In July, the company had reached agreements on waiver terms for all three of its credit facilities totaling $908 million, after it violated its debt covenants in March due to interest-rate swaps that went sour amid the global economic crisis. [ID:nBNG517676]

    Shares of the Athens-based company, which owns a fleet of 40 container ships, were trading down 51 cents at $5 in after-market trade. The stock had closed at $5.51 Tuesday on the New York Stock Exchange. (Reporting by Adveith Nair in Bangalore; Editing by Pradeep Kurup)

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