COPENHAGEN, Oct 9 (Reuters) - Ratings agency Moody'sInvestors Service said a rescue deal for Danish shipping groupTorm A/S was positive for its lenders' credit ratingsas they managed to steer clear of substantial costs related toany closure.
Torm's banks said last week they would take control of theshipping firm, extending repayments on $1.8 billion of debt andproviding fresh funds to see the firm through the downturn.
Moody's said on Tuesday it had expected Torm's lenders -Nordea , Danske Bank , Danish Ship Financeand SEB - could have been hit with significant costsrecovering already-depreciated collateral.
"The restructuring is credit positive because it avoids awind-down," Moody's said in a statement.
The debt-laden tanker and dry-bulk firm has been fightingfor survival in a sector slump, now in its fourth year, causedby a weak global economy, oversupply of vessels and low freightrates.
Moody's said the restructuring deal underlined the stressesmany shipping firms and their lenders faced while problem loanratios for banks' shipping portfolios remained elevated.
Last week's deal saw Torm's banks take a near 73 percentstake in the business, while time charter partners will get a17.3 percent stake. Existing shareholders will retain 10 percentof the business.
Torm had been in talks with its 14 banks for months, tryingto secure a comprehensive financing solution.
(Reporting by Mia Shanley; editing by Niklas Pollard)
Keywords: MOODYS TORM/