Cecon gets construction financing for Davie newbuilds

cecon newbuildJANUARY 2, 2013 — Cecon ASA has arranged construction financing to complete the three construction vessels it has had on order at Quebec's Davie shipyard since 2007. Cecon said today that it and York Capital Management Global Advisors LLC have signed a committed term sheet for a multi-tranche senior secured bond issue of up to USD 107.5 million for the purposes of purchasing the existing Export Development Bank of Canada Loan, providing incremental working capital to Cecon, and funding the completion of construction of Hull 717 at Chantier Davie Canada. In addition to construction financing for Hull 717, York has made conditional construction financing of up to USD 175 million available for Cecon for the completion of Hulls 718 and 719, respectively.

As part of the financing, York will receive detachable warrants representing a
15.0 percent pro forma equity interest in Rever Offshore AS. Rever is today a 100 percent owned Cecon subsidiary with ownership of the three aforementioned Hulls and the construction contracts at Davie.

The Term Sheet is subject to a final bond agreement acceptable to York to be entered into between Cecon and Norsk Tilltsmann ASA as trustee, and an inter- creditor agreement with existing bondholders. The bond agreement and inter- creditor agreement are expected to be finalized and signed before the 31. Jan, 2013.

ABG Sundal Collier and Parteo Securities are together with Seabury Securities LLC advisors for Cecon, and Blackstone's Restructuring Group is advisor for York in this transaction.

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