Magazine article American Banker

Global Marine Will Suspend Service on Debt

Magazine article American Banker

Global Marine Will Suspend Service on Debt

Article excerpt

CHICAGO -- Global Marine Inc. said it will suspend principal and interest payments on about $1 billion of long-termi debt while it continues to negotiate a restructuring of its loan agreements.

The company has been in discussions with its creditors since May 22. It had hoped to have a revised program in place by July 1, but negotiations are continuing, said Richard Vermeer, senior vice president.

"But that's a tight deadline when you are trying to get people of the world to agree on a plan," he said.

Global Marine has several different loan agreements with more than 40 banks internationally. Most of the banks are foreign-owned institutions in Finland, France, and Singapore, or are foreign branches of U.S. banks, Mr. Vermeer said.

Global Marine also has a $100 million domestic line of credit that expires in 1986. The lead bank in that agreement is Bank of America. The other participants are Continental Illinois National Bank and Trust Co., First National Bank of Chicago, Manufacturers Hanover Trust, InterFirst Bank Dallas, First City National Bank of Houston, and the Bank of California.

About $23 million in standby letters of credit have been issued against that line, Mr. Vermeer said. As a result of the company's current financial situation, "there is a possibility that [the standby letters of credit] might be called," he said. He would not elaborate, however, on what evens would have to occur for that to happen, nor would he specify the obligations that the letters of credit guarantee. …

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