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www.maritimeprofessional.com | Maritime Professional | 25loon at the end of Þ ve years). The debt issue is being led by Merrill Lynch Bank America. The recent Marine Money conference in New York provided some insights into the trading of loans for maritime compa-nies, an important tool for banks man-aging exposures to different companies and sectors. Ms. Jennifer Box, Senior Vice President at Oaktree Capital (an active player in deep-sea ship Þ nance) offered that: ÒTrading begets more trad- ing É youÕll see that for companies that have been historically followed where people know the story É youÕll see one trade É and then thereÕs a market.Ó She said ÒThereÕs a whole universe of ship- ping loans, for partially private compa- nies and well known companies, where banks just havenÕt seen a trade happen yet,Ó adding that ÒWeÕve only tipped the iceberg in terms of what could happen.Ó From the tradersÕ angle, they can bene- Þ t, selling their debt at a proÞ t, if a com- panyÕs prospects improve (and its yield is reduced, based on less perceived risk). Looking AheadFor Harvey Gulf, as it starts Þ ring on all cylinders (presumably, burning LNG), its credit rating may improve from the B1, which is in the ÒSpecula-tiveÓ category several notches below investment grade. According to Stan- dard & Poors, another rating agency, the Term B loan will provide a yield to maturity between 5.9% and 6.00%. The minimal call premiums would enable an issuer to buy back its debt, and re-issue at a lower rate if its rating improves. Earlier this year, another U.S. ß ag OSV player, Hornbeck Offshore called back $250 million of 8% senior notes (debt) issued in 2009 (and due in 2017) and en-tered into an even larger eight year bond (maturing in 2021) with a 5% coupon. MP #3 18-33.indd 25MP #3 18-33.indd 259/10/2013 10:10:08 AM9/10/2013 10:10:08 AM
