American Industrial Partners will acquire a Jersey City bulk-freight shipping service.
AIP, in an agreement by its affiliate Lightship Capital LLC, will move Rand Logistics Inc.’s second lien debt into 100 percent of the new common equity of the reorganized company.
The agreement will eliminate about $90 million in outstanding debt and dramatically reduce annual interest expense.
“We are thrilled to partner with Rand and its leadership team to welcome a new beginning for a clear market leader in shipping and logistics on the Great Lakes,” said AIP Partner Jason Perri. “Rand’s track record of reliability, safety and service in moving critical raw materials among world-class customers between ports on the Great Lakes speaks for itself. We are pleased to help Rand reduce its debt burden and restore its financial health for the benefit of all stakeholders, especially customers and employees, and look forward to working with Rand to continue to improve its operations and broaden its capabilities as a new platform for growth under our ownership.”
The AIP transaction will allow Rand to enjoy its strongest financial position in recent years, according to a release. Rand’s business will continue uninterrupted, pending completion of the transaction, the terms of which provide for payment in the ordinary course of all company vendors and other unsecured creditors.
“We are pleased that we have reached an agreement, which will allow Rand to significantly reduce its debt burden and partner with a leading private equity firm,” said Rand CEO and President Edward Levy. “The transaction firmly addresses Rand’s recent balance sheet challenges and positions the company for continued customer service and growth.”