ECONOMY

Enterprises frees its ship

LONDON (Reuters) – Greek-controlled shipping company Enterprises Shipholding said a French court had freed one of its ships impounded by the company’s bondholders following a dispute over $175 million in defaulted junk bonds. The container ship Canmar Supreme had been held in the port of Fos, France since August 24, and was the second ship to have been impounded since Enterprises defaulted in July. The company has succeeded in lifting one of the wrongful seizures and is seeking the prompt release of the remaining vessel, said a statement on Wednesday. Enterprises…remains steadfast in its aim to negotiate an amicable solution, it added. Enterprises said last month that it would seek damages from bondholders over the first detention of an Enterprises ship, the Ocelotmax in the Korean port of Pusan on August 4. The 25,900 gross ton ship has not traded since. The bondholders said they seized the ships to force Enterprises to negotiate with them after it defaulted on the bond’s $7.76-million semiannual interest coupon in July. Talks broke down between the two parties in recent months after Enterprises refused to recognize the bondholders’ financial adviser. It has now appointed the US investment bank Jefferies & Co to secure a settlement on its behalf. The bondholders are largely US-based investment funds, while Enterprises Shipholding is controlled by Greek shipping entrepreneur Victor Restis and is incorporated in Liberia. The bondholders behind the seizure said they owned more than 60 percent of the bond notes. Enterprises has a fleet of 17 refrigerated ships, 15 of which are laid up and not trading. It also has five container vessels, two of which are laid up and one of which is under seizure. The shipping industry tapped the US junk bond market extensively between 1997 and 1999. Since then, many shipowners have defaulted on their bonds, and much of the debt has been bought back having traded down to less than half its original value. Other stocks like Motor Oil, Petrola and Iaso are also mentioned by other brokers as candidates for inclusion.