Svithoid sunk

The shipowner was hoping to reorganise, but now admits it is not an option.

Svithoid said: “The board of directors in Svithoid Tankers decided yesterday on Sunday the 12 October to investigate the possibilities for a company reorganisation.

“After having reviewed the circumstances this morning it has become clear that the prerequisites do not exist. The board of director has therefore decided to apply for insolvent liquidation.”

TradeWinds reported earlier today that talks between Svithoid, its creditors and shareholders had failed.

At that time, however, Svithoid was still hopeful of finding a resolution to its liquidity issues.

It said: “The board of directors believes that there are opportunities for reaching long term profitability and therefore it is in the company's and the shareholders' interest to file for company re-organisation.”

The liquidation of Svithoid comes after it admitted last week it “lacks the ability to perform under its undertakings”.

Sven Lundgren, deputy managing director of Svithoid, said the company was struggling to pay for three bareboat chartered vessels.

He suggested at least two parties were interested in a takeover or merger of the company, but ruled out further cost cutting measures.

He said: “We are in such a situation that big strokes have to be taken rather than cost cutting measures. The small steps have been taken already.”

Svithoid controls a fleet of 11 product and chemical tankers up to 5,000 dwt, including three ships on bareboat charter. It has five double-hull newbuildings on order for delivery this year, Clarksons says.

The company, formerly known as Delphi Private Placement Group, is led by chairman Gunnar Nygren who holds 2,182,146 shares.

It listed in July 2006 with Torvald Klaveness, and real estate and shipping entrepreneur Paal Hveem among its early investors.