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ZEABORN Group takes over business operations of Rickmers-Linie and NPC Projects

[ February 13, 2017   //   ]

ZEABORN Group, which was established in 2013, has taken over the business operations and the international organization of Rickmers-Linie, including NPC Projects. ZEABORN also takes over the business operations of MCC Marine Consulting & Contracting, which is active as bunker and chartering broker.

The corresponding contracts between the Rickmers Group and Zeaborn were signed on Feb. 7, 2017. The execution of the transaction is subject to antitrust clearance.

Despite a far-reaching restructuring program launched on May 28, 2014, which achieved a temporary break-even in Q1 2015, overall the Rickmers-Linie business segment has reported several heavy losses over recent years. EBITDA 2011: € -3.9 million; EBITDA 2012: € -17.9 million; EBITDA 2013: € -33.5 million; EBITDA 2014: € -15.3 million; EBITDA 2015: € +0.9 million; EBITDA 1HY 2016: € -5.3 million. The cumulated operating losses as EBITDA since 2011 currently amount to € 75 million.

The underlying cause is the acutely competitive overall situation in the global breakbulk, heavylift and project-cargo business, compounded by corresponding overcapacities – not only in the multipurpose carrier area but also in container vessels, bulk carriers and RoRo vessels, which in some cases are carrying breakbulk, heavylift and project cargoes when their own capacity utilisation is low.

The low freight rates achievable in this market environment are not sufficient to cover the full costs of the Rickmers-Linie business sustainably, given its size. Furthermore it is not financially possible to make the necessary growth-orientated investments in fleet renewal. From Rickmers-Linie’s perspective, therefore, a move towards consolidation in the breakbulk, heavylift and project-cargo business was and is unavoidable.

In the medium term, regarding the current earnings forecast for 2017 – 2020 the sale of Rickmers-Linie effected on Feb. 7, 2017 will contribute to a stabilization of the operating (EBITDA) earnings and cash-flow development of the Rickmers Group. Within the context of the package of restructuring measures approved on 4 March 2016, in the medium term this move should also support the process launched to restructure the Rickmers Group’s finance-debt exposure.

However, in the short term the single-digit million-euro compensation the Rickmers Group is to pay under the terms of the sale will burden its liquidity position. Furthermore, the Seller and the Purchaser have agreed to maintain full confidentiality regarding the terms of the agreed transaction.

Under the terms of the Rickmers Bond listed on the Frankfurt Stock Exchange Prime Standard, the sale of the Rickmers-Linie business segment does not represent an ‘Event of Default’ that would trigger bondholders’ Right of Termination.

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