Hong Kong's Anglo-Eastern Group, which provides ship and crew management and supervisory services for ships under construction, was owed US$953,335 by Genmar, followed by mainland shipbuilder Cosco Shipyard (Zhoushan) which was owed US$921,932.

Court papers show a further US$109,328 was due to Kylin Worldwide (Hong Kong), which supplies marine paints and other coatings, while Wallem, another ship management and ship services firm, was owed US$48,402.

Anglo-Eastern chief executive Peter Cremers said Genmar remained a client 'so it may not be strategically correct I make comments'. But he added: 'At this moment, at our level it seems very much business as usual as ships need to earn money. Hence they need to be running, hence operating costs need to be funded.' The company manages the day-to-day operations, including providing crew, of several Genmar tankers from its Singapore office.

Harwood said a further court hearing was due to be held yesterday that would seek the judge's approval of key elements of Genmar's corporate restructuring. This included clearance for a restructuring agreement that was signed on Wednesday between Genmar, senior secured creditors and OCM Marine Investments, part of Oaktree Capital Management.

This would see OCM Marine Investment inject US$175 million of new equity that would be used to fund a reorganisation plan and convert debt to equity. Further equity investment would also be sought. The judge is also likely to agree to Genmar suspending bank loan repayments for up to three years.

If the bankruptcy protection plan is approved, Genmar said it could emerge 'from bankruptcy in the spring of 2012'.

Harwood said Genmar's move to seek bankruptcy protection would trigger three or four other shipping firms to file for protection over the next two or three months as they fell victim to poor shipping markets.

Shipping companies that had used their cash stockpiles to fund operations since the 2008 financial crisis, when tanker and dry cargo markets crashed and had barely recovered three years later, were now running out of money. 'It's going to be a very, very rough six months,' Harwood said.

While Genmar's financial difficulties were partly caused by the US$620 million purchase of seven tankers last June, the company was also hit by lower charter rates. As a result, spot earnings shrank from US$25,911 per day in the first quarter of last year to US$13,043 per day in the fourth quarter. Average earnings for a supertanker are now about US$20,000 per day, according to Clarkson, the British shipbroker.

Harwood said Genmar had 'bought a fleet at the top of the market and got overextended'. The drop in charter rates had squeezed Genmar's cash reserves as freight revenues barely covered operating costs, while banks also took a tougher line.

Nigel Binnersley, a partner in the Hong Kong office of Blank Rome, said decisions favouring other overseas shipowners by the US bankruptcy courts meant 'foreign operators with little or no obvious connection with the US can now quite easily seek bankruptcy protection relief. For distressed shipowners looking for a 'loan holiday', this looks to be attractive option and one which they should at least consider taking'.