The Vroon family will lose its majority stake in its shipowning company after 132 years of activity, the firm announced on 7 January.
An untimely investment in offshore vessels left the company ill-prepared for the oil market crash of 2014, and Vroon struggled to repay a hefty billion-dollar debt. After five years of trying to right the ship, the shipowners decided to cede a majority stake to the company’s bankers in return for debt relief. Vroon reached an agreement to that effect in November 2021, but the company waited to announce it until an investor update was released on Friday.
Between weak sales and asset write-downs, Vroon has been losing hundreds of millions of dollars a year since 2016. It has been in on-and-off talks with lenders since the start of the oil crisis and reached an initial restructuring agreement with its banks in 2018. Managing Director Coco Vroon resigned shortly thereafter, making way for CFO Herman Marks to step up and manage the company’s restructuring.
However, the company lost another $314 million in 2020, mostly due to asset write-downs. The company has taken steps to stem the losses, including the sale of 18 vessels in the container, bulk, crew transfer and car transport segments. Market conditions have improved in 2021 and the company expects full-year results to be better than they were in 2020, despite a smaller fleet.
The debt cancellation agreement reduces Vroon’s debt load from around $1.1 billion to just $400 million, according to Dutch outlet Nieuwsblad Transport. Combined with the vessel sales, this will strengthen the company’s balance sheet and “enable the continuity of the business in the future”, Vroon said in a statement. In exchange for the delisting, a group of 18 banks will become majority shareholders of the company, subject to final approval.
“We are cautiously optimistic for 2022 and expect continued improvement for our offshore division and most of our remaining offshore businesses,” the company said. “We are grateful for the support our lenders have provided over the past few years and believe that with the implementation of the restructuring agreement, Vroon has a clear path forward.”