Business

Aegean Chapter 11: Bondholders object Mercuria’s $532 million DIP Facility

‘It is an insider transaction designed solely to benefit Mercuria and is not in the best interests of the Debtors’ estates.’

Published

6 years ago

November 9, 2018

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An Ad Hoc Group of bondholders with investments in troubled New York-listed bunkering firm Aegean Marine Petroleum Network (Aegean, or, Debtors) on Thursday filed an objection at the U.S. Bankruptcy Court over a debtor-in-possession (DIP) financing facility offered by Mercuria to bail out Aegean.

“The Mercuria DIP Facility should not be approved because it is an insider transaction designed solely to benefit Mercuria and is not in the best interests of the Debtors’ estates,” they alleged in a court document seen by Manifold Times.

“Mercuria’s onerous insider DIP financing facility which, among other things, is designed to syphon value from the Debtors’ unsecured creditors for Mercuria’s benefit and facilitate Mercuria’s acquisition of all of the Debtors’ assets via an insider credit bid under Bankruptcy Code section 363.”

Mercuria has earlier agreed to provide more than $532 million in postpetition financing to fund the chapter 11 process and Aegean’s working capital needs.

“Nominally, the Mercuria DIP Facility provides the Debtors with approximately $532 million in DIP financing,” claims the Ad Hoc Group.

“In reality, however, Mercuria will provide the Debtors with, at most, only an incremental $152 million of financing through revolving postpetition credit facilities and a new delayed draw term loan. The remaining $380 million of “DIP financing” is in the form of a roll up of Mercuria’s prepetition debt.

“Mercuria seeks to implement this roll up in an accelerated manner, with 50% of Mercuria’s prepetition debt to be rolled up automatically upon interim approval of the Mercuria DIP Facility and the remaining 50% of Mercuria’s prepetition debt to be transformed into postpetition debt through a ‘creeping roll up’ as prepetition receivables are collected during the early stages of these chapter 11 cases.

“If approved, the roll up would not only convert all of Mercuria’s prepetition debt into superpriority administrative expense claims, it would provide Mercuria with substantial credit enhancement.”

The group further alleges the Mercuria DIP Facility, and the path proposed by Mercuria in Aegean’s chapter 11 cases, “is a prime example of an insider transaction that should be subjected to heightened scrutiny to ensure a value-maximizing reorganization for all of the Debtors’ stakeholders.”

“Yet, since Mercuria entered into the MOU with the Debtors, Mercuria has sought to execute on its self-serving loan-to-own scheme.”

The Ad Hoc Group explained it had delivered a term sheet on July 6, 2018 to Aegean to provide up to $50 million in secured financing to address the November 1 maturity of the 2018 Notes.

However, Mercuria entered into a Memorandum of Understanding (MOU) with Aegean a day before on July 5, 2018 for a US$1 billion trade finance facility.

“From that point forward, Mercuria improperly exercised control of the Debtors to block any meaningful negotiation with other potential financing parties, refusing to consider restructuring proposals that would have avoided the need for the commencement of these cases,” they say.

“The MOU that was executed between Mercuria and the Debtors on July 4, 2018 was an overreaching agreement representing the first step in Mercuria’s scheme to take control of the Debtors.

“Pursuant to the MOU, Mercuria agreed to acquire the Debtors’ U.S. and global revolving credit facilities and, upon acquisition of the facilities, Mercuria would receive 30% of the Debtors’ common stock and the right to appoint a representative to the Debtors’ board of directors.

“From this initial agreement with Mercuria, it was clear that Mercuria was not interested in a traditional lender-borrower relationship but, rather, desired to—and started acting like—a controlling stakeholder of the Debtors.”

A timeline organised list of events preceding the current development have been recorded by Manifold Times below:

Published: 9 November, 2018

Business

Singapore: Ang Wee Keong from IMDA appointed as new MPA Chief Executive

Ang will relinquish his IMDA appointment as Assistant Chief Executive (International) of the Info-Communications and will officially take over from Teo Eng Dih from 16 June.

Published

1 hour ago

April 30, 2025

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Singapore: Ang Wee Keong from IMDA appointed as new MPA Chief Executive

Singapore’s Ministry of Transport on Tuesday (29 April) said Mr Ang Wee Keong, currently the Assistant Chief Executive (International) of the Info-Communications Media Development Authority (IMDA), will concurrently be appointed as Chief Executive (Designate) of the Maritime and Port Authority (MPA) from 1 May to 15 June 2025.

He will relinquish his IMDA appointment and be appointed Chief Executive of MPA from 16 June 2025. He will succeed Mr Teo Eng Dih, who will be appointed Deputy Secretary (Special Duties) at the Ministry of Transport with effect from 16 June.

Mr Teo will remain as a member of the MPA Board until he steps down as CE MPA. Mr Ang will be appointed as a board member with effect from 16 June 2025.

“The Ministry of Transport thanks Mr Teo Eng Dih for his leadership and contributions as Chief Executive of MPA, and welcomes Mr Ang Wee Keong,” the ministry added.

Mr Teo Eng Dih (张英智)

As the Chief Executive of the MPA, Mr Teo made significant contributions to grow Singapore’s International Maritime Centre and the PIER71TM startup ecosystem. During his tenure, the Port of Singapore attained new records in vessel arrivals, container throughput, bunker sales and registrations under the Singapore Registry of Ships. MPA was also recognised as one of the key global regulators by Lloyd’s List. These milestones were reached amidst a complex global operating environment marked by geopolitical uncertainties, supply chain disruptions and technological shifts affecting the flow of goods and supplies worldwide.

Mr Ang Wee Keong (洪伟强)

As the Assistant Chief Executive (International) of IMDA, Mr Ang made significant contributions in advancing Singapore’s digital interests and thought leadership in the international arena. He strengthened Singapore’s network of digital economy partnerships, and expanded collaboration through platforms like the ASEAN Digital Ministers’ Meeting, Forum of Small States and Asia Tech x Singapore (ATxSG). He also oversaw the formulation of forward-thinking policies and regulations in digital technology and services to advance the growth of Singapore’s digital economy, including the upcoming Digital Infrastructure Act to enhance the resilience and security of systemically important digital infrastructure.

Photo credit: Singapore Polytechnic
Published: 30 April, 2025

Technology

TFG Marine to launch of ZeroNorth e-BDNs at Port of Sohar after Singapore success

Kenneth Dam announced the successful trial and imminent roll-out of ZeroNorth’s electronic bunker delivery note solution for its customers in the Port of Sohar, in Oman.

Published

1 hour ago

April 30, 2025

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TFG Marine to launch ZeroNorth e-BDNs at Port of Sohar after success in Singapore

Global marine fuel supply and procurement firm TFG Marine on Tuesday (29 April) announced the company’s successful trial and imminent roll-out of ZeroNorth’s electronic bunker delivery note (e-BDN) solution for its customers in the Port of Sohar, in Oman.

A first for the Middle East region following the successful deployment of the same technology earlier this year by TFG Marine at the Port of Singapore. The eBDN trial in Oman was completed in collaboration with ZeroNorth and SGTraDex, using the Singapore standards as a benchmark.

Kenneth Dam, Global Head of Bunkering, said: "We’re excited to partner with ZeroNorth, Fratelli Cosulich Group Bunkers, SGTraDex and SOHAR Port and Freezone to shortly introduce e-BDNs to our customers here in Oman.”

“This technology, that we have already successfully introduced in Singapore is yet another step in modernising our industry. It will streamline the bunker delivery process, cut administrative burdens, enhance digital documentation and help build a smarter, more connected bunkering sector.”

“We remain committed to establishing e-BDNs as a global standard for bunker fuel delivery and will continue to work closely with port authorities to advocate for and deploy this technology across our operations.”

Dam made the announcement at the Oman Maritime, Ports and Energy Forum, during the panel discussion on The Transformative Power of Data: The Evolving Role of Digitalisation in Shipping and Bunkering.

Dam added the fully digital solution — accessible through TFG Marine’s mobile app and integrated with SGTraDex’s digital infrastructure, — will enable the inclusion of additional data, such as mass flow meter readings during fuel deliveries.

“By integrating this technology, we will drive significant improvements in efficiency, accuracy, compliance, and sustainability across our operations, complementing the global mass flow meter rollout across our fleet and reinforcing TFG Marine’s position at the forefront of the modern bunkering industry,” he said.

Manifold Times previously reported TFG Marine announcing the introduction of ZeroNorth’s e-BDNs for its customers in Singapore during 23rd Singapore International Bunkering Conference (SIBCON) by the end of 2024.

In November last year, TFG Marine announced its first digitalised marine fuel delivery in Singapore using electronic bunker delivery notes (e-BDNs).

Its team supplied VLSFO bunker fuel to Pacific Basin Shipping Limited’s Illovo River bulk carrier, marking the first of four bunkering deliveries that month where this new technology was successfully deployed.

Photo credit: TFG Marine
Published: 30 April, 2025

Biofuel

Hercules Tanker Management vessel “Mount Kibo” takes on B30 bio bunker fuel

HTM said its tanker was successfully supplied with B30 bunkers by tanker “Hercules Sky”, another HTM-owned vessel and operated by Peninsula, marking the first biofuel supply to the HTM fleet.

Published

1 hour ago

April 30, 2025

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Hercules Tanker Management vessel “Mount Kibo” takes on B30 bio bunker fuel

Hercules Tanker Management (HTM) on Tuesday (29 April) announced that its tanker Mount Kibo has been successfully supplied with B30 bunkers by tanker Hercules Sky, another HTM-owned vessel which is operated by Peninsula.

The operation marked the first biofuel supply to the HTM fleet.

HTM is the shipping venture launched last September by John A. Bassadone, founder and CEO of independent marine fuel supplier Peninsula.

HTM said the operation carried out in the Strait of Gibraltar aligns with the recent discussions at MEPC 83, where key decisions were made to advance maritime decarbonisation, including new fuel standards and a global pricing mechanism for emissions.

“Additionally, this initiative supports the objectives of the FuelEU Maritime Regulation, which promotes the use of renewable, low-carbon fuels and clean energy technologies for ships,” it said.

“By utilising biofuels, we are contributing to the reduction of greenhouse gas emissions and supporting the industry's transition towards cleaner energy solutions.”

Photo credit: Hercules Tanker Management
Published: 30 April, 2025