Northern, WI 6/21/12 (StreetBeat) -- Shares of Eagle Bulk Shipping Inc (Nasdaq:EGLE) rose as much as 42 percent on Thursday, after the drybulk shipper's lenders agreed to waive any defaults.
The debt-laden company's lenders, led by Royal Bank of Scotland Plc (NYSE:RBS), agreed on Wednesday to convert a $1.13 billion debt to a term loan which matures in 2015.
"We view the avoidance of bankruptcy and the conversion of its credit facility into a non-amortizing term loan expiring at the end of 2015 as at the positive end of possible outcomes," Citigroup analyst Christian Wetherbee wrote in a note.
The agreement comes at a time when banks are tightening credit lines to the shipping industry and resorting to seizure of the defaulters' vessels.
The company's shares were trading up as much as 41 percent at $4.20 in early trade on Thursday.
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