PT Berlian Laju Tanker Tbk (collectively, with certain of its subsidiaries and affiliates, “BLT”) is an Indonesia-based shipping company that formerly operated a fleet of over 40 ocean-bound vessels transporting refined petroleum products, liquefied natural gas, and other liquid cargoes, across the globe. Milbank, Tweed, Hadley & McCloy LLP acted on behalf of the secured parties under BLT’s approximately US$650 million Senior Secured MLA Credit Facility, including DNB Bank ASA, Singapore Branch, the facility agent, as well as affiliates of KKR and York Capital, the largest lenders under the facility (the “MLA Lenders”).
On December 1, 2015, BLT and the MLA Lenders consummated the second stage of a comprehensive, multi-year restructuring process, which culminated with the consensual transfer of substantially all of the collateral securing the MLA Credit Facility to a newly-formed company controlled by the MLA Lenders in exchange for the discharge of their secured claims. The collateral transferred included, among other things, the “Chembulk” fleet of vessels and cash in certain accounts associated with the vessels. The newly-formed company is sponsored by KKR and York and will operate under the name “Chembulk Tankers” and will be headquartered in Southport, Connecticut. As part of the consensual restructuring, BLT will receive warrants to purchase a minority interest in the new company.
The restructuring transactions, which were undertaken pursuant to a Restructuring Support Agreement entered into by BLT and the MLA Lenders in April 2015 and completed approximately 7 months later, were novel and complex, involving the coordinated use of various in-court and out-of-court processes, including 27 Singapore schemes of arrangement, a consensual foreclosure under the New York Uniform Commercial Code, multiple account enforcement actions in Singapore and New York, and the first ever out-of-court amendment of a court-approved restructuring plan under the Indonesian PKPU restructuring regime.
The MLA Lenders selected Milbank to lead a team of advisors located across the globe in structuring, negotiating, and documenting the transaction, and to build consensus behind the transaction among BLT, its largest equity holders, and numerous well-organized and competing creditor constituencies in Asia, the United States and beyond. The formulation and execution of the elements of the restructuring were uniquely challenging in light of the need to complete the transactions on an expedited timeline, while complying with requirements of maritime, insolvency, and corporate law regimes in multiple jurisdictions.
The Milbank team representing the MLA Lenders was led by Abhilash Raval (Financial Restructuring Partner, NY), David Zemans (Managing Partner of Milbank’s Singapore Office and Milbank’s Asia Practice) and Jacqueline Chan (Partner, Singapore), and included Mark Mandel (Corporate Partner, NY), Blair Tyson (Alternative Investments Partner, NY), Dennis O’Donnell (Financial Restructuring Of Counsel, NY), James Orme (Senior Attorney, Singapore), Lauren Doyle (Financial Restructuring Associate, NY), John Timmerman (Corporate Associate, NY), Michael Price (Financial Restructuring Associate, NY), Kelsey Baumberger (Alternative Investments Associate, NY), and Martin Wong (Associate, Singapore).
