Products tanker operator Omega Navigation Enterprises Inc. (NASDAQ:ONAV) says that it and certain of its subsidiaries have filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code with the U.S. Bankruptcy Court for the Southern District of Texas (Houston). The company says it believes that the Chapter 11 process will facilitate restructuring, which is designed to restore the company to long-term financial health.
A statement issued today says that “in light of the unwillingness of its Senior Lenders to work with Omega on an out-of-court restructuring of its Senior Loan Agreement, the company needs the protection of Chapter 11 to ensure the uninterrupted operation of its vessels and services to its customers. The company is disappointed in the Senior Lenders’ intransigence and has commenced litigation against them in Greece. The company wishes to assure its customers and suppliers that Omega will continue to operate in the ordinary course of business during its Chapter 11 proceedings.”
The Chapter 11 filings include the following companies and vessels: Omega Navigation Enterprises, Inc.; Omega Navigation (USA) LLC; Galveston Navigation Inc (the Omega Lady Miriam); Beaumont Navigation Inc (the Omega Lady Sarah); Carrolton Navigation Inc (the Omega Prince); Decatur Navigation Inc (the Omega Princess); Elgin Navigation Inc (the Omega Queen); Fulton Navigation Inc (the Omega King); Orange Navigation Inc (the Omega Emmanuel); and Baytown Navigation Inc (the Omega Theodore).
The Chapter 11 filings do not include Omega Management Inc, the company’s technical vessel manager, nor wholly-owned subsidiary Omnicrom Holdings Ltd, which indirectly owns a 50% interest in each of the vessels Omega Duke and Alpine Marina through two separate joint venture entities, nor Omega Investments Inc, which owns 80% of OD Investment Inc, the owner of the vessels Megacore Honami, Megacore Philomena and of Hull 2295 (under construction) and Hull 2299 (under construction).
In addition, as separately announced by the company, effective July 1, 2011, the Company’s joint venture with Topley Corporation, named Megacore Shipping Ltd., was terminated. This termination will have no effect on the Chapter 11 proceedings.
Omega’s principal legal advisor for the restructuring process and Chapter 11 proceedings is Bracewell and Giuliani LLP. The Company’s financial advisor is Jefferies & Company, Inc.
July 8, 2011