MHI had already invested four years in the $100 million project before the company was evicted this past January by the US Maritime Administration after it defaulted on a $55-million bank loan guaranteed by the Federal agency. Quincy had invested $7.5 million in the plan. MHI filed for bankruptcy soon after the eviction.
The company had 120 days to file a debt plan but once that period lapsed, other companies came forward with proposals for the 180-acre shipyard. The Maritime Administration has reviewed a number of these proposals, including some that involved reconstructing it as a mixed-use complex.
MHI now says that Boston Financial Advisors LLC will raise the money the company needs to renovate the shipyard. Boston Financial, which reportedly was formed specifically to raise money for MHI, will sell bonds through an investment banking firm it declined to identify to get the money.
A source close to the deal tells GlobeSt.com that the bonds are backed by a security pool of life insurance policies purchased on the market. "The only way they can do this is to get new money in there," says the source who adds that MHI is "currently negotiating with people."
MHI plans include reviving the shipyard with the ability to make tankers and other large ships. It is unclear whether the bond offering will be a success, especially in light of the rocky road the shipyard plan has had until now. Reportedly, sale of the bonds will begin in July.
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