Global Maritime Investments Cyprus Ltd. has filed for Chapter 11 bankruptcy protection, thus joining the club of dry bulk shipping companies that were unable to brave the major downturn in the dry bulk market.
The Chapter 11 process is aimed at liquidating the company’s business.
According to the court papers filed in New York on Tuesday, September 15th, the company has accrued around USD 169 million in debt, writes the Wall Street Journal.
The amount includes losses from 2014 worth $47.8 million and about $67.6 million from 2015 fiscal year.
The company attributed the decision to seek bankruptcy protection as it was unable to pay back its debt since market overcapacity pushed down charter rates hampering the carrier’s ability to secure enough profit.
Global Maritime’s fleet that employed 60 vessels in 2012, has been reduced to 15 bulk carriers, the court papers seen by the Wall Street Journal show.
Despite a glimpse of optimism stemming from a push for scrapping of older tonnage, the dry bulk shipping market is not expected to recover until 2017, due to contracting demand for iron ore and coal, according to shipping consultancy Drewry.
World Maritime News Staff