Nautilus Files for Bankruptcy After Container Rates DropDawn McCarty and Phil Milford
Nautilus Holdings Ltd., owner of a 16-vessel container shipping fleet, filed for bankruptcy protection in New York, citing a drop in charter rates.
The Hamilton, Bermuda-based company listed assets of more than $500 million and over $100 million in debt in Chapter 11 documents filed yesterday in U.S. Bankruptcy Court in White Plains.
“The debtors’ business has experienced significant pressure as a result of the expiration of several existing long-term charter contracts with rates higher than current charter rates, which reflect a depressed market for container vessels,” James Mesterharm, the company’s chief restructuring officer, said in a court filing today.
Other ocean-transport companies have sought bankruptcy protection in recent years, including Peter Georgiopoulos’s Genco Shipping & Trading Ltd. in April and his General Maritime Corp. in 2011. Overseas Shipholding Group Inc. filed in 2012, while Excel Maritime Carriers Ltd. filed last year.
The vessels in the Nautilus fleet are owned by separate units, according to court papers. The ships range in size from about 2,500 TEU to 7,000 TEU. TEU, the standard for measuring a container ship’s cargo carrying capacity, stands for twenty-foot equivalent unit.
Mesterharm said the 16 ships are chartered to container lines including Maersk, Hapag-Lloyd, Yang Ming Marine Transport and Arab Shipping Co. Mesterharm, a managing director of AlixPartners LLP, said he was appointed yesterday by Nautilus to lead the restructuring.
The case is In re Nautilus Holdings Ltd., 14-bk-22885, U.S. Bankruptcy Court, Southern District of New York (White Plains).