S&P Global to Buy IHS Markit for $44 Billion in 2020’s Biggest Merger
By Noor Zainab Hussain (Reuters) – Data giant S&P Global Inc has agreed to buy IHS Markit Ltd in a deal worth $44 billion that will be 2020’s biggest merger,...
OSLO, May 30 (Reuters) – Frontline Ltd, the tanker arm of shipping tycoon John Fredriksen’s business empire, expects losses to widen in the second quarter and may struggle to repay a 2015 bond as the shipping crisis shows no sign of abating.
The global shipping sector has seen four years of crisis as vessels purchased in an order binge before 2008 hit the waters, creating overcapacity as demand remains anaemic.
“The board is of the opinion that the tanker market is massively oversupplied today and that it may take some time before a reasonable market balance is restored and sustained recovery of the tanker market occurs,” the group said on Thursday.
Frontline, which Fredriksen restructured last year to save from bankruptcy, said its first-quarter net loss totalled $19 million after a $7 million profit a year ago, beating expectations for a $34 million loss.
“Based on rates achieved so far in the second quarter, increased dry-docking costs in the second quarter and the current outlook, the board expects the operating result in the second quarter to be weaker than in the first quarter,” it said.
The company also repeated an earlier warning that unless the market recovers in the short term, and if it cannot raise additional equity or sell assets, it will not have the cash to repay a $225 million bond due in April 2015.
It said its total cash-cost breakeven for very large crude carriers was about $25,500 a day, above the first quarter’s time charter rate of $17,000, while for Suezmax tankers it was at $18,500, above the quarter’s $14,500.
Frontline shares fell 1.2 percent in early trade. (Editing by David Holmes)
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