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Troubled Mercator Lines to sell another vessel to reduce debt

DRY bulk shipping company Mercator Lines, which came under judicial management on Jan 18, has entered into a memorandum of agreement to sell another vessel, MV Kalpana Prem.

This follows news in January that it was selling five vessels for US$32.3 million.

The latest vessel is secured to the company's major shareholder, Mercator International (MIPL), and will be sold to a third party for U$2.9 million, thereby reducing the debt owed to MIPL.

The vessel is expected to be delivered to the buyer in April 2016.

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Separately, its judicial manager also said that HSH Nordbank AG Singapore Branch has filed a winding up application in the High Court of Singapore against the company's subsidiary, Varsha Vidya Inc.

The application will be heard on April 15.

Mercator Lines' chairman and non-executive director, Harish Kumar Mittal, and three other non-executive directors have recently resigned from the firm. Trading in the shares has been suspended since Nov 12.