Mercator divests its crude carrier, aims to reduce debt

Leading dredging company Mercator has sold its very large crude carrier Nerissa (VLCC), which was built in 2006, for a total net consideration of USD 27.5 million. The company said that the proceeds from this sale will be utilised to bring down its debt and other liabilities.

The company further clarified that the sale does not fall within the definition of related party transactions.

In 1HFY19, the company’s total debt was Rs 1348.86 crore, while its debt-to-equity stood at 1.81x. In the last 8 consecutive quarters, the company has been posting net losses and reduction in the debt would give some relief to the company as interest burden would reduce going forward.

In Tuesday’s trading session, the stock of Mercator ended in the negative terrain. The stock opened at Rs. 4.80 and closed for the day 4.54 per cent down at Rs 4.42, close to the day's low of Rs 4.40.

Mercator is one of India's largest private sector dredging companies. The group has a presence in varied segments, namely, shipping, offshore services, oil exploration and production, dredging, coal mining/trading and logistics.