Bulk Invest of Norway Files for Bankruptcy

by San Antonio Attorney

Bulk Invest, a Norwegian bulk carrier, recently filed for bankruptcy after a botched restructuring proposal by a group of ship owners.  This occurred following the sale of the company’s charter business to the chairman.

Bulk Invest’s malfunction in finances adds up to a roster of failed businesses in the dry bulk shipping industry due to a decreased demand in China.  A lot of shipping companies have been selling ships to increase liquidity and neutralize the showdown.

The company will abandon its plan for restructuring after a company comprising seven Japanese shipowners did not approve of the carrier’s deal.  The shipowners have filed an injunction in order to undo the process of purchase of Bulk’s charter business to Kistefos AS, a Norwegian private equity firm.

A legal representative from Norway has been hired by the Japanese shipowners, challenging the said purchase.  The process of sale allegedly benefits the owner of Kistefos at their own expense.

Bulk Invest, previously known as Western Bulk ASA, was a dry bulk shipping company.  It runs operations on vessels under a long term charter contract with a fixed rate.

Due to the rapid decline in commodities markets, bulk shipping companies have been facing financial difficulties.  Scorpio Bulkers and Star Bulk Carriers have already stripped down 90% of their market value from the past year.  Eagle Bulk Shipping, a company who filed for bankruptcy last 2014, has to meet a deadline to settle a deal with its lenders.

Other shipowners that were severely affected by this trend include Primorsk International Shipping, who filed for bankruptcy last Sunday.

Asia’s bulk shipping companies were also not spared as Japan’s Daiichi Chuo Kisen Kaisha, a company based in Japan, also filed for bankruptcy protection.

Bulk Invest has an estimated total liabilities of $143.4 million.

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