(Dow Jones) Tanker owner and operator B+H Ocean Carriers Ltd. (BHODD) filed for Chapter 11 bankruptcy Wednesday to restructure its balance sheet as it tries to weather the challenges facing the global shipping industry.
The Bermuda company, weighed down by $46.1 million in debt and only $4.5 million in assets, said in a news release that weak lending in the global shipping market combined with high freight rates and vessel values made a restructuring in Chapter 11 its best option. It added that it has discussed the restructuring with lenders but didn’t explicitly say this route had their support.
B+H is the latest in a string of freight companies including General Maritime Corp., TBS International PLC and Marco Polo Seatrade BV to file for Chapter 11 recently, blaming a weak shipping industry.
“There are more ships currently on the water than are absolutely needed to meet the demand for ship services,” Hamish Norton, managing director of Jefferies & Co.’s maritime shipping investment banking unit, said in January regarding the state of the shipping industry.
B+H, which specializes in the transportation of fuel and dry commodities, said it has $32.4 million in secured claims, owed to Bank of Nova Scotia Asia Ltd., Bank of Scotland and Nordea Bank, according to documents filed with the U.S. Bankruptcy Court in Manhattan.
It also said bondholders hold a $13.5 million unsecured claim.
In November, B+H announced that it was delisting from the New York Stock Exchange and discontinuing its filings with the U.S. Securities and Exchange Commission as part of an effort to reduce administrative expenses by 20%. Common stockholders owning less than 101 shares were paid $4 a share.
B+H was established in 1988 and currently owns and operates six combination carriers and one bulk carrier, according to its website. It said it plans to have a field development vessel that will provide support in offshore oil fields by 2013.
It filed for Chapter 11 along with nine related companies.
– by Stephanie Gleason, Dow Jones & Co, Jacqueline Palank in Washington contributed to this article.