Update on International Shipholding Corporation (3/17)

 

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As reported in the September 2016 issue of the LOG, on July 31, 2016, International Shipholding Corporation (ISH) and a number of its subsidiaries filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the Southern District of New York. Three subsidiaries that have a contract with the SIU are included in the bankruptcy: Waterman Steamship Corporation, Central Gulf Lines, Inc., and Sulphur Carriers, Inc. During the course of the bankruptcy proceedings, these Companies have continued to operate as usual.

 

On March 2, 2017, Judge Stuart Bernstein approved ISH’s Plan of Reorganization. Under this Plan, a reorganized Central Gulf Lines will continue to operate the following Pure Car/Pure Truck Carriers: the Green Bay, Green Cove, Green Lake and Green Ridge. Reorganized Waterman Steamship will operate the Ocean Giant, the Ocean Globe, the Mississippi Enterprise, and the Texas Enterprise. Sulphur Carriers, Inc. will not remain in business. As of this date, it is not known whether one of the other companies will continue to operate the Sulphur Enterprise.  This Plan of Reorganization is subject to MARAD’s approval.

 

Waterman, Central Gulf and Sulphur Carriers owed several months of contributions to the Seafarers employee benefit plans when they filed for bankruptcy. Waterman and Sulphur Carriers also owed wage increases to employees who worked on the Ocean Globe, the Ocean Giant, and the Sulphur Enterprise after the bankruptcy petition was filed. After lengthy negotiations, the SIU and its employee benefit plans were able to reach a settlement with the bankrupt companies under which we expect to receive 60 percent of the amount of the wage increases owed to employees for the period from August 1, 2016 through January 31, 2017; as well as 60 percent of the contributions owed to the employee benefit plans, provided that the plan of reorganization is approved by MARAD. Once the union receives this money, we will send all affected employees their pro rata share of the wage increase payment. The payments will also ensure that all employees will continue to receive the full benefits to which they are entitled from the SIU plans.

 

The SIU expects that the reorganized companies will continue to provide a similar number of jobs on their vessels as before, with salaries and benefits that are comparable to the salaries and benefits that employees on these vessels have been receiving.

 

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