Solstad Offshore is seeking to suspend and defer interest and amortisation payments to creditors as part of a refinancing effort - but the proposed move hinges on approval from bondholders.

The Oslo-listed offshore vessel owner is negotiating a deal to temporarily halt such debt payments from 20 December as it struggles to service debt after racking up a heavy loss in the third quarter.

While the contemplated suspension pact would not apply to certain loans, the company stated it “may be widened at a later stage”.

Given it would affect one of its bond loans, Solstad has called a meeting of bondholders on 19 December to gain their approval for the proposed agreement.

Solstad, formed out of an earlier tripartite merger with Farstad Shipping and Deep Sea Supply in 2016, has been struggling to generate profitability for its 140-vessel fleet due to low utilisation and dayrate levels amid a continued lack of activity in its main North Sea market.

It is backed by Norwegian holding company Aker that has a 20% ownership stake in Solstad.

The cash-strapped player has has been engaged in talks with lenders and other stakeholders to “improve the overall liquidity situation and to create a robust long-term platform for the company”.

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Solstad in loan deferral bid