The container liner company Zim said it had completed a comprehensive debt restructuring.
Zim's parent company, Israel Corp., invested $200 million of new equity into Zim and agreed to provide a $50 million receivables-financing facility in return for retaining a 32-percent stake in the company (previously it had owned more than 99 percent).
Lending banks, shipowners and bondholders agreed to exchange approximately $1.4 billion of Zim’s total $3.4 billion in debt and liabilities for the remaining ownership stake in Zim.
The company said its remaining debt "will mainly consist of debt secured by vessels with an amortization profile that is linked to Zim’s business plan and unsecured notes listed on the Tel Aviv Stock Exchange with a maturity of nine years. In addition, Zim has restructured its charter payments to shipowners as a result of which they will be reduced by 46 percent overall."
Zim said the restructuring "provides the company with a stable, long-term capital structure. The company will now focus on the implementation of its business plan, with a view to achieving profitability in the near future."
In a document on its website dated April 2014, Zim said, "As part of its
business plan, Zim plans to shut down its operations in two of its
non-profitable trade lines: the Asia-North Europe line in the course of
2014, and the Asia-South America (East) line in the course of 2015. The
large ships that become available as a result of shutting down the
Asia-North Europe line will be directed to use in the Asia-USA (East)
It also said that it "assumes that at the beginning of 2016,
it will lease six new mega vessels in sizes between 10,000-13,000 TEU
that will join its fleet and be operated in the Asia-USA (East) line."