Banks are delaying in releasing from mortgage Moby’s ships to be transferred to DFDS
The swap of ferries announced in September depends on Unicredit’s and MPS’ choice which, in turn, are pressed by bondholders
The exchange of ferries between Moby and the Danish DFDS announced last September was temporarily suspended and it probably will not be concluded by the end of October as provided for by the agreement between the parties.
The slow down was caused by the fact that the lending banks Unicredit and MPS did not release the mortgages encumbering the two units object of the transfer. Obviously, this prevents the sale from being concluded.
On top of that, bondholders (more specifically some fifteen hedge funds) decided to include also the banks’ action in a possible dispute to ascertain the responsibilities of those who exhausted Moby Group’s assets. In fact, although they have no rights on the company’s fleet, the bondholders do not want credit institution to release the two ferries object of the transfer to DFDS in exchange for two older ships (over 30 years old) from their related mortgages.
According to Ship2Shore’s sources, said mortgages have not been released yet, so much so that Moby Aki and Moby Wonder have not been delivered yet. In its capacity as security agent of the pool of banks which in 2016 granted Moby a 200 million loan, Unicredit is carrying out legal investigations also on behalf of the other exposed banks (MPS, Banco BPM, UBI and Intesa Sanpaolo) to figure out whether or not to cancel the mortgages and allow the disposal of the ships without being held responsible for having validated the disposal of modern assets.
However, regardless of what they will decide, timing can affect Moby significantly because it had planned to accumulate capital gains in the financial year for a total of over 50 million euro by 31 December, also thanks to said disposals. If this transaction is not concluded, financial year results for 2019 will not meet expectations, and consequently also the relations between balance-sheet items and the company’s compliance with the financial covenants entered into with banks will be affected.
Moreover, Moby announced that it wants to start a dialogue with bondholders which might result in a debt restructuring pursuant to Article 182 bis of the bankruptcy law.
Finally, DFDS had planned several weeks of works at the shipyard to modernize the ferries Moby Aki and Moby Wonder. However, in case of a substantial delay in the delivery of the ships, and consequently in their deployment on the new connection between Amsterdam and Newcastle, said restyling could be suspended or annulled.
At this point, everything depends on the decision of the exposed credit institutions and of the Onorato family’s company.