JUNE 27, 2014 — Vard Holdings Limited has agreed in principle to terminate a shipbuilding contract with Rem Offshore ASA in return for a compensation.
The contract with Rem for one Offshore Construction and Anchor Handling Vessel was entered into in June 2014. At that time Vard said the contract was valued at NOK 800 million.
Delivery of the vessel was originally scheduled for first quarter 2016, but had previously been postponed until first quarter 2018.
The vessel is in an early stage of construction.
Vard says the agreement to terminate the shipbuilding contract is part of a restructuring plan agreed in principle between Rem and its bank lenders, major bondholders, and main stakeholders.
As part of the compensation for the termination, Vard says it will receive shares equal to approximately 4% of the total issued shares in Rem after the restructuring.
Effectiveness of the termination is contingent on the restructuring plan being approved.
Vard is currently evaluating the financial impact which will be disclosed when it announces its unaudited results for the second quarter ending June 30, 2016.