Marco Polo Marine Ltd

[GPD]

IMO, both companies need to make a case to be accountable to their shareholders.

I reckon, soon, the out-of-court settlement will be reached, and with a confidential detail. 

I wonder how a deal can be struck since MPM net assets are worth less than the rig itself.  Also in this depressed O&G sector, MPM assets are probably worth a lot less than their book.

[Ray168]

http://infopub.sgx.com/FileOpen/Update_b...eID=379823

Seems like Marco Polo having some cash flow issue and unable to pay the 2nd payment for the rig. According to sembmar update, the 2nd payment already been deferred twice as requested by Marco Polo......

Based on what  SM presented , MP has a weaker case to cancel the rig order . MP seems doomed .

MP announcement. http://marcopolo.listedcompany.com/newsr...RTYG.1.pdf

Who is right or wrong... yet to be seen.

Based on the reading of the announcement, it does not seem that MP had tried to settle this dispute amicably or reach out of settlement process. My gut feel is that Semb marine has some leverage in this spat. But lose-lose for both (lawyers laughing their way to the bank).

(not vested. Kaypoh vb [emoji14] )

Sent from my D5503 using Tapatalk

UPDATE ON TERMINATION OF THE US$214.3 MILLION RIG CONSTRUCTION CONTRACT WITH PPL SHIPYARD PTE LTD FOR THE CONSTRUCTION OF A HIGHSPECIFICATION JACK-UP RIG 

- Marco Polo Drilling (I) Pte. Ltd. Maintains Its Position That It Is Fully Discharged Of Its Obligations To Take Delivery Or Make Further Payment To PPL Shipyard Pte Ltd In View Of The Latter’s Failure To Comply With Certain Of Its Material Contractual Obligations 

- 70 Cracks Found On All Three Legs Of The New Rig In First Test And More Than 180 New Cracks (Not Including Other Defects) Found In Partial Second Test

http://marcopolo.listedcompany.com/newsr...PKED.1.pdf

[Ray168]

Marco Polo takes rig dispute with SembMarine to mediation stage

02 Dec 2015 09:00



By Tan Hwee Hwee



MARCO Polo Marine said on Monday that its unit MP Drilling has taken its dispute with Sembcorp Marine's PPL Shipyard over a US$214.3 million rig building contract to the mediation stage.



The action was taken on Nov 26, said Marco Polo. This followed MP Drilling's initiation of the contractual dispute resolution process on Nov 24.

"Should PPL refuse to mediate, MP Drilling will proceed to commence arbitration against PPL," Marco Polo said in its Monday announcement.

Marco Polo maintained that MP Drilling has fully discharged itself from taking delivery of or making further payment towards the jack-up rig being built under the contract announced in February 2014 with PPL.

But Sembcorp Marine had in two recent announcements said that the rig was in the final phase of construction and that the termination by MP Drilling was a "repudiatory breach". It also insisted that the contract was still in force and that it was seeking a second payment from MP Drilling.

In its announcement on Monday, Marco Polo said that MP Drilling regards "the nature and number of cracks and other defects (such as porosity) found on all three legs of the new rig at this stage of construction wholly unacceptable".

It said that 70 cracks were found on all three legs of the new rig in the first test in August and that more than 180 new cracks were found in a partial second test subsequently.

Sembcorp Marine had announced that that the contract was still subsisting and that the disputes were technical in nature. It also said that PPL would be inviting MP Drilling to refer the disputes to the Classification Society, whose decision shall be final and binding on the parties as provided for under the contract. "PPL will also be seeking payment of the 2nd disbursement if MP Drilling fails to make payment by 30 November 2015," said Sembcorp Marine.

* This article was published in The Business Times on 01 Dec 2015 and is reproduced here with permission in its entirety.

[Ben]

Macro Polo has certainly made a name for itself from this saga. I wonder after the oil crisis, if they managed to survive, will they still be able to get a reputable supplier to build for them again? If yes, at what term? IMO, both sides will suffer, but it seems like MP will suffer greater damages.

[cfa]

SMM is in better financial position to face this law suit , MP may kaput if SMM win the case . MP has more to lose !

[desmondxyz]

SMM is in better financial position to face this law suit , MP may kaput if SMM win the case . MP has more to lose !

MP got no choice. If they don't play dirty they also kaput, they simply don't have the stomach to swallow this rig at this kind of tough environment, at least the lawsuit still give MP some hope....

[4humanity]

Marco Polo has a 50 million notes due in oct 2016. They have not yet issued any new notes up till now...

[brattzz]

SMM is in better financial position to face this law suit , MP may kaput if SMM win the case . MP has more to lose !

MP got no choice. If they don't play dirty they also kaput, they simply don't have the stomach to swallow this rig at this kind of tough environment, at least the lawsuit still give MP some hope....

Seadrill also deferred delivery and went into JV with SMM...

not sure why MP want to go this way...

[specuvestor]

As per my comment on other thread, if they inform they cannot pay then it's due for "restructuring", or creditors could refuse and take the process further. If keep quiet don't pay it's called default. It's simple not political when money is the key determinant. No need announcement to officially default... as if people won't know... crazy

If they are to get other financing and repay it will be called "refinancing". It's more than terminology.

(Bloomberg) --
A Singapore provider of barges and tugs for coal, steel scrap and iron ores plans to ask bondholders for approval to delay paying S$50 million ($37 million) of securities due next month after appointing an external adviser to review its business.

Marco Polo Marine Ltd. told some noteholders of the plan at a meeting Tuesday, and those present “appeared generally supportive,” it said in a filing to the Singapore Exchange. The firm said it will hold another meeting on Sept. 16 to allow investors to digest the proposed terms of the debt extension, which it didn’t disclose.

The company joins regional peers including Otto Marine Ltd., Perisai Petroleum Teknologi Bhd. and AusGroup Ltd. in seeking forbearance from creditors amid a slump in oil prices that have crimped spending by their customers. Energy-services provider Swiber Holdings Ltd. filed to operate under court supervision in late July after running out of cash to pay lenders and bondholders, while Keppel Corp. and Sembcorp Marine Ltd., the world’s biggest builders of oil rigs, have both reported a plunge in profits.

Marco Polo Marine’s 5.75 percent bonds are due Oct. 18, according to data compiled by Bloomberg.

The firm appointed KPMG Services Pte as adviser to conduct an independent business review of the group business, according to a Sept. 7 filing. The group had S$18.3 million of cash as of June 30, while $186.5 million of its S$253.8 million borrowings were due within 12 months, according to its latest published accounts.

[brattzz]

so, that is the real story of MP.... no wonder!