Genco Shipping & Trading Limited (NYSE:GNK) filed for Chapter 11 bankruptcy protection while it finds a way to deal with $1.3 billion in debt and restructures its business, the Associated Press reports. Genco had $277.5 million in revenues in 2013, roughly half of what it made in 2010. With 53 ships, Genco is one of the world’s largest drybulk shipping companies in the world, but it mostly rents its boats out to other businesses so changing rates can have a big impact on its revenues.

Genco Shipping

Genco to be delisted by the NYSE

Genco Shipping & Trading Limited (NYSE:GNK) stock price has collapsed in the last few years, after trading in the mid $20s during most of 2010, it was trading for $1.70 before trading stopped, but it was hardly alone. General Maritime Corp. (which, like Genco, was founded by shipping magnate Peter Georgiopoulos) emerged from bankruptcy in 2012, and Excel Maritime, Overseas Shipholding Group, and TMT Group have all filed for Chapter 11 protection since the end of the financial crisis, reports Stephanie Gleason for The Wall Street Journal.

Shortly after Genco Shipping & Trading Limited (NYSE:GNK) announced that it had filed Chapter 11, the New York Stock Exchange halted trading on Genco stocks and set the company’s delisting into motion.

Genco reached agreement with its many creditors

Genco Shipping & Trading Limited (NYSE:GNK) has reached an agreement with at least three major creditors and some of its bondholders who have agreed to support the shipping company’s plan during the bankruptcy proceedings. Genco will convert $1.06 billion in debt to 81.1% equity in the company that emerges from bankruptcy, while other credit facilities totaling more than $300 million will have their maturity pushed to August 2019. Convertible bondholders will get a combined 8.4% of equity in the new company, unsecured debt will be honored and current shareholders will receive warrants for equity in the company.

The plan still has to be approved by the bankruptcy court, but with widespread support among creditors, it should have a good chance of being approved as long as the judge believes the plan is realistic. If Genco Shipping & Trading Limited (NYSE:GNK) can come back with a healthy balance sheet once the global economy has fully recovered, the new equity may be worth a fair bit more than the common stock’s current price, but any resolution on the bankruptcy and reorganization is pretty far down the road.