Update: Lithuanian Shipping Company Dodges Bankruptcy

The Government of Lithuania has struck a deal that will save its debt-laden bulk shipping company PC ‘Lithuanian Shipping Company’ (LSC) from bankruptcy. Namely, an agreement was reached with the company’s creditors to postpone debt payment.

“After the agreement to postpone the debts repayment term with the bank was reached, the company is now able to arrange with other creditors and maintain its activity. AB SEB bank will provide an additional EUR 3 million loan, guaranteed by JSC ‘Lithuanian Railways’,” said Rimantas Sinkevičius, Minister of Transport and Communications of the Republic of Lithuania.

Within the bailout plan, a transport holding company consisting of LSC, ‘Lithuanian Railways’ and other state-owned transport companies is planned to be set up.

The deal was reached on Friday, July 24, just a day after Lithuania’s Ministry of Transport and Communications filed for bankruptcy proceedings of Klaipeda-headquartered bulk shipping company amid ongoing financial troubles that plunged the bulker owner in debts.

The state-owned company which employs 237 workers has been piling up losses since 2008, and the accumulated loss currently stands at EUR 20 million, according to Sinkevicius. The company’s inability to pay its debts led to several arrests of its vessels by different claimants.

The first arrested LCS ship Deltuva has returned to Lithuania from the port of Gdansk with 19 crew on board.

The Ministry said that the funds which will ensure that all arrested LSC vessels are provided with fuel and other necessary measures have been transferred.

The company’s general cargo ship Raguva and its crew of 20 were recently detained in Senegal’s capital Dakar, while another company’s cargo ship – the 17,786 dwt Romuva – was detained in Italy due to unpaid fuel and service bills.

World Maritime News Staff

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