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Bermuda-based Hermitage Offshore Services has announced the results of the auctioning off of its fleet of platform supply vessels and crew boats as part of its Chapter 11 bankruptcy proceedings.
The offshore vessel company and 28 of its subsidiaries back in August filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York citing prolonged slump in global oil prices driven, in part, by the COVID-19 crisis. Trading of the company’s shares on the New York Stock Exchange and OTC listing were suspended in lsat month after its market cap fell below the NYSE’s continued listing standard requirement.
Hermitage Offshore Services today announced the sale auction received a highest bid of approximately $80 million in aggregate from its lenders for Hermitage’s ten platform supply vessels. Hermitage said the successful bid constitutes a “credit bid” against the company’s outstanding indebtedness and will not result in the receipt of any cash consideration.
Hermitage’s eleven crew vessels, meanwhile, will be sold to an unaffiliated third party that submitted a successful bid of approximately $5.3 million in cash, in aggregate. The sale of the vessels remains subject to final approval of the bankruptcy court and definitive documentation between the Company and the prospective purchasers.
While Hermitage initially said it expected to maintain business operations and relationships with its customers and vendors throughout the Chapter 11 process, the company later flagged “significant doubt” as to its ability to operate as a going concern following the bankruptcy proceedings and made “no assurance that it will be successful in its appeal of the decision of the NYSE to delist the securities or that there will be any equity value in its common shares at the conclusion of the Chapter 11 process.”
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