Italian bulk shipping company, Nova Marine Holdings, is poised to enter the livestock transport business, paying about $37m for Wellard's Ocean Swagman.
Until last week the mid-sized vessel used by West Australian-based live exporter, Wellard, on short-haul cattle shipping routes to Asia, was set to sell to WA pastoral business, Heytesbury Holdings.
The new sale deal is likely to reap an extra $4.5m.
Wellard will use the funds to pay outstanding finance on the ship, bought in 2010, and repay company creditors, particularly noteholders owed about $23m with whom Wellard continues to negotiate a standstill agreement.
The original Heytesbury deal was expected to cut the group's overall debt from about $125m to around $95m.
The company's outstanding debts include loans with unsecured noteholder creditors, Black Crane Capital in Singapore, which is also an ordinary Wellard shareholder, Penta Asset Management Ltd, and the Virgin Islands-based TradeInvest Asset Management Company.
In June the listed Wellard advised it could not meet certain security compliances under the agreement, forcing an end to a standstill agreement and prompting the company to consider selling one of its four remaining vessels.
Wellard's noteholders were previously expected to receive about $14.8m from the sale to Heytesbury by August 31.
Wellard has now told shareholders, while it still had an implementation agreement with Heytesbury, it had accepted a proposal from Nova's Panama-based arm Trim Shipping to buy its M/V Ocean Swagman for $US25.2m.
The deal was still to be officially approved by Nova's board, but was expected to get the green light.
The latest announcement comes after Wellard confirmed it was actively negotiating with another party late last week, with the new deal involving "superior proposal".
Negotiations with the Holmes a Court family's Heytesbury Holdings had earlier slowed after Heytesbury requested more time to complete its due diligence into the transaction.
It had also wanted to amend the terms of the initial transaction.
Heytesbury initially offered about $32.4m for the livestock carrier, which Wellard has used to ship beef cattle to Indonesia and Vietnam, and dairy breeding heifers to China.
Plans were afoot to charter the ship back to Wellard after the Heytesbury purchase, until March 2021 or longer.
A new arrangement with Nova will mean a break fee may have to be paid by Wellard to Heytesbury, which is also a significant (11.42 per cent) shareholder in the livestock exporter.
The WA company has not indicated if it will be looking to lease the vessel from its new owners, but may otherwise settle for making short term lease arrangements with other shipping companies when demand requires.
Nova, which was established for local shipping on the Italian coastline in 1981, has built an extensive global fleet of bulk vessels, although has not been involved in livestock before.
The 130-metre-long Ocean Swagman has capacity to carry 7000 cattle or up to 26,000 sheep, or a combination of both.
Its advanced ventilation system fans an averagae of 110 air changes an hour, or four times the Australian standard and 3.5 times the number on a commercial aircraft.
Source: Queensland Country Life