First Ship Lease Trust

[Boon]

Hi Boon,

The issue is that banks are not willing to refinance despite (i) prompt payments, (ii) data from comparable transactions which shows FSL's fleet has the cash to continue servicing the debt and (iii) good valuations. Clearly, something else is stopping/whispering to the banks to finance FSL. We can argue how strong business fundamentals are relative to repayments, but we also know business in the real world is not that straightforward.

Imo as well, it is highly unlikely the SIC in MAS will reject this transaction and the outcome will be down to how many shareholders voting against it

http://fsltrust.listedcompany.com/newsro...esults.pdf
From 1Q2017 Results

The Board of Directors is committed to improving the structure of the Trust’s balance sheet, and continues to explore as a matter of the highest priority the Trust’s options in respect of securing a refinancing of the Trust’s outstanding debt.
Addressing the refinancing priority, the Board of Directors stated:
“The Board and Management have acted proactively on the refinancing issues to ensure the long-term stability of the Trust amid the volatility and reduction in vessel values. On 28 April 2017, a term sheet was entered into with Navios Maritime Holdings Inc. (“Navios”) for the proposed acquisition of over 154 million units representing approximately 24.23% of issued units in the Trust from FSL Holdings. Under the term sheet, Navios will also extend a US$20 million second priority mortgage convertible loan to the Trust. Navios currently controls a diversified fleet of over 170 vessels, and we believe that this agreement with an established industry player will place the Trust on a stronger footing to secure the refinancing.” 
_________________________________________________________________________________________________________________________________________________________________

It doesn't appears to me that Navios is going to provide the full refinancing. 

To place the Trust on a stronger footing to secure the refinancing, there are many options, but, it all boils down to meeting the security value expectation of lenders.

Why would banks not lent, if their lending criteria (no matter how stringent ) could be met? 
____________________________________________________________________________________________________________________