Friday, May 24, 2024
Hawai'i Free Press

Current Articles | Archives

Tuesday, August 23, 2011
Horizon Lines Misses Aug. 15 Payment on $330 Million in Convertible Notes
By Selected News Articles @ 8:37 PM :: 8201 Views :: Energy, Environment, National News, Ethics

by Shannon D. Harrington and Jonathan Keehner, Bloomberg - Aug 17, 2011

Horizon Lines Inc. (HRZ), the shipper negotiating a debt restructuring with its lenders, missed an Aug. 15 interest payment on its $330 million of convertible notes and says it intends to make the payment as it announces an anticipated deal with creditors.

Horizon Lines has “exercised the 30-day grace period” on its 4.25 percent notes due in August 2012, Jim Storey, a spokesman for the Charlotte, North Carolina-based company, said in an e-mailed statement. The company said June 1 that it had entered into agreements with holders of the notes as part of a debt restructuring they expected to complete this month.

The operator of container ships that serve the continental U.S., Alaska, Hawaii and the nation’s territories “intends to make the payment when we announce the expected refinancing transaction, which we anticipate in the near future,” Storey said in the statement.

The bonds traded at 50 cents on the dollar today, according to a person familiar with market prices. That’s down from 54.75 cents on Aug. 15, according to Trace, the bond-price reporting service of the Financial Industry Regulatory Authority. They’ve dropped from 74.5 cents on July 13, Trace prices show.

Shares fell 1.6 percent to 87 cents as of 3:59 p.m. in New York Stock Exchange composite trading.

Horizon Lines, which has had three years of mostly declining container volumes, said the agreements it reached with noteholders were part of a deal that would refinance its entire capital structure. In addition to the convertible debt, Horizon Lines has a $225 million senior secured revolving credit facility and a $125 million secured term loan.

The refinancing included $350 million of new five-year, first-lien, 9 percent senior secured notes and an “asset-based” revolving loan of as much as $125 million that it was negotiating with a lender, according to the statement in June.

The company amended the agreements seven times since the announcement and last month extended a deadline by which it was required to receive commitments from holders, according to a July 29 regulatory filing.

The shipper averted a potential May 21 default on the convertible debt after a federal court agreed to reduce a $45 million fine by two-thirds at the request of the government. Horizon Lines had agreed to pay the fine to resolve price-fixing charges.




TEXT "follow HawaiiFreePress" to 40404

Register to Vote


Aloha Pregnancy Care Center


Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii


Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together


Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii


OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii