April 10 (Reuters) - Ship Finance International Ltd said it agreed to terminate charter contracts with Horizon Lines for five vessels in return for a stake of the restructured company and a compensation of $40 million in notes.
Ship Finance, which owns and operates ships, will get warrants exercisable into 10 percent of Horizon Lines’ common stock as part of the compensation.
In a separate statement, Horizon Lines, which has been restructuring itself, said it has completed transactions with more than 99 percent of its noteholders that will cut the company’s debt by $188.4 million.
The vessels, which have been chartered to Horizon Lines for five years, will be employed in the time-charter market, Ship Finance said.
“Ship Finance will become a large stakeholder in the restructured Horizon Lines and expects to benefit from both the interest on the notes as well as the value of securities received,” Chief Executive Ole Hjertaker said.
Shares of the Hamilton, Bermuda-based Ship Finance International were trading down slightly at $13.91 on Tuesday morning on the New York Stock Exchange.