Norway-based dry bulk shipping company Golden Ocean Group Limited (GOGL) has reached and agreement to purchase two modern Capesize vessels from affiliates of Hemen Holding Limited.
The ships would be bought from the company, indirectely controlled by trusts established by John Fredriksen, at a price of USD 43 million per unit.
"We are pleased to be in the position to acquire high quality, modern Capesize vessels that are expected to generate free cash flow immediately upon delivery. This transaction is consistent with our strategy of focusing our commercial efforts on the vessel segments that we believe will provide the greatest leverage to a recovery in the dry bulk shipping market," Birgitte Ringstad Vartdal, CEO of Golden Ocean Management AS, said.
As settlement of the purchase price for the ships, Golden Ocean will enter into a non-amortizing seller's credit loan with an affiliate of Hemen for 50% of the purchase price, which bears interest at LIBOR + 3.00% per annum and matures three years after delivery of the vessels.
GOGL informed that the remaining part of the purchase price will be settled on delivery of the vessels with an estimated USD 9 million of cash and an estimated USD 34 million of newly-issued common shares of the company at a per-share price equal to the offer price in an expected equity offering.
The Capesizes are expected to be delivered within four months of the date hereof, Golden Ocean said, adding that the completion of the transaction is subject to completion of an equity offering and entry into the seller's credit loan.
Once the acquisition and expected equity offering is finalized, Hemen, together with certain of its affiliates, will maintain its current ownership percentage of around 34.2% of GOGL's issued and outstanding common shares.
Furthermore, as Golden Ocean's financial position has been enhanced over the past 12 months, the company intends to terminate the covenant waivers related to its recourse debt upon completion of the expected equity offering, Ringstad Vartdal informed.
"This will reinstate the normal covenants, which the company is now in compliance with, and remove the company’s restrictions on new acquisitions, new debt and dividend payments. The waiver structure in the non-recourse debt related to the transactions announced in March 2017 will remain," Ringstad Vartdal said.
Japan Marine United Corporation (JMU) held a naming ceremony for a newbuilding liquefied natural gas (LNG) carrier at its Tsu Shipyard on October 16.
Named Energy Liberty, the 165,000m3 vessel is jointly owned by Japan's Mitsui O.S.K. Lines (MOL) and Tokyo LNG Tanker, a subsidiary of Tokyo Gas. It will be the eighth LNG carrier owned and managed by Tokyo LNG Tanker.
MOL will directly manage six of those vessels, including the latest newbuilding.
After delivery, the 299.9-meter-long carrier will transport LNG from the Cove Point Project in the US to Tokyo Gas facilities.
The Japan-flagged vessel features a tri fuel diesel electric propulsion system and a self-supporting prismatic shape IMO Type B (SPB) cargo tank.
Last week was very busy for Jebel Ali-based Transworld Group as the shipping and marine logistics conglomerate completed the acquisition of three ships.
Namely, the fleet of Shreyas Shipping, Indian-flagged ship owning unit of Transworld Group, was expanded with the Indian-flagged containership MV Hansa Langeland, built in 2003. The 1,581 TEU Handysize containership has since been renamed SSL Ganga.
On October 12, the company finalized the purchase of the MV Queens Quay from Germany's ER Schiffahrt. The Panamax containership, also built in 2003, has since been renamed SSL Brahmaputra.
"The SSL Brahmaputra is our largest Indian flag vessel and is a sister vessel of the OEL Jumeirah," Transworld said.
And finally, the latest vessel acquisition is MV Amsterdam, which has since been renamed SSL Balaji. The general cargo ship built in 2007 joins the Shreyas fleet as the second multi-purpose vessel after the SSL Sabarimalai.
In addition, Shreyas Shipping has sold a 1989-built Feedermax SSL Sagarmala for scrap to a breaking yard in Bangladesh, according to the data from Vesselsvalue. The ship is valued at USD 1.35 million.
The company's fleet is comprised of 13 vessels, including 12 containerships and one small dry bulker vessel.
The number of ships registered in the International Association of Dry Cargo Shipowners (INTERCARGO) has surged by 48 percent in the first three quarters of 2017.
As a number of new members joined the association during the period and existing members added significant number of ships, INTERCARGO passed the 1,500 ships threshold with a total tonnage of 138 milion dwt at the end of the third quarter of the year.
Additionally, the associations number of full members increased by 32 percent, passing the 100 threshold.
"We are proud that INTERCARGO-entered ships continue to outperform industry averages in respect of detentions and deficiencies per inspection," John Platsidakis, INTERCARGO Chairman, said.
Platsidakis added he would encourage the formation of a dry cargo charterers' assessment scheme which would enable them to promote their quality of performance.
The information was presented as part of semi-annual meetings held by INTERCARGO's Technical and Executive Committees in Athens on October 9 and 10, 2017.
Main topics covered at the meetings included the safe carriage of cargoes, the non- availability and adequacy of reception facilities for cargo residues and cargo hold washing waters hazardous to the marine environment (HME), port state control transparency and anti-corruption practices, operational challenges after the entry into force of the ballast water management convention, air emissions, design standards for bulk carriers and related equipment.
INTERCARGO will hold its next meetings in Singapore in March 2018.
Greek shipping company Diana Shipping has decided to scrap its 2004-built vessel Melite which sustained damage to its hull as a result of grounding earlier this year.
The company informed that it has signed, through a separate wholly-owned subsidiary, a memorandum of agreement (MOA) to sell to an unnamed party the vessel for demolition, on an "as is where is" basis.
The sale price is around USD 2.52 million before commissions, according to Diana.
The 76,400 dwt vessel is expected to be delivered to the buyer until October 30, 2017.
As explained, the owner of Melite has submitted a notice of abandonment to its hull and machinery underwriters, who have not, as of today's date, accepted this notice. However, they have agreed to the sale of the vessel on the terms outlined in the above mentioned MOA.
Diana said that this notice of abandonment forms part of owners' claim against the vessel's hull and machinery underwriters resulting from the grounding. If accepted by the insurers, the notice will result in the payment to owners of the vessel’s total insured value of approximately USD 14 million.
On July 26, Melite grounded off the coast of Pulau Laut, Indonesia. Following the indicent, no injuries and no signs of pollution were reported except the physical damage to the vessel.
At the time of the grounding, the Panamax was chartered to Germany-based Uniper Global Commodities. However, since July, Melite has been on an off-hire period during an active charter, Diana’s data shows.
Once the sale of Melite is completed, Diana Shipping's fleet will comprise 50 dry bulk vessels. As of today, the combined carrying capacity of the company's fleet, including Melite, is approximately 5.9 million dwt, with a weighted average age of 8.2 years.
Following the purchase of five dry bulkers in August, Pacific Basin Shipping Limited is exploring more acquisitions of second-hand tonnage lured by attractive prices.
"We will continue to look at attractive secondhand ship acquisition opportunities if they can generate a reasonable payback at prevailing asset prices and freight earnings," Mok Kit Ting, Kitty, the company's Secretary, said in a third-quarter trading update.
Three of the five recently bought second-hand vessels have been delivered into Pacific Basin’s fleet during the quarter, with one more to follow later this year and another in the first quarter of 2018.
"These latest acquisitions will increase our owned fleet to 106 ships, grow the proportion of our owned versus chartered Supramax ships, and reduce our owned Supramax daily break-even levels," Ting said.
During the quarter, the company completed the sale of its final tug, concluding its exit from towage business.
Pacific Basin further added that during the third quarter of 2017 its daily TCE earnings for Handysize and Supramax ships stood at USD 8,130 and USD 9,350 respectively, representing an improvement of 15% and 27% compared to the same period in 2016.
The company added that its year-to-date average Handysize and Supramax daily net TCE earnings increased 25% and 41% year on year.
"The dry bulk freight market indices for most of 2017 have followed a similar pattern as last year, although at a significantly higher level. The typically weak start to the year was followed by a stronger second quarter, but a seasonal mid-year decline affected index rates in the third quarter," a company comment on the market reads.
"Stronger demand growth across most cargo categories drove a marked increase in rates over the last few weeks of the quarter. However, due to the lag between securing cargoes and performing voyages, and with most of our fourth quarter revenue days already covered, these stronger rates will have a marginal effect on our 2017 results."
Speaking of the outlook, Pacific Basin claims to be well positioned to benefit from the market rebound.
"Our healthy cash and net gearing positions, our competitive cost structure, and our increased proportion of owned ships all position us well for a recovering market," Ting added.
Norwegian ferry builder Brødrene Aa, Hyen, has received an order for three high-speed carbon fiber catamaran ferries intended for the Chinese market.
As informed, the company signed a contract with Zhongshan Hong Kong Passenger Shipping Co-op Co., Ltd.
The construction of the vessels is expected to begin at the shipyard in Hyen in November 2017. To be completed and delivered by June 2019, the ferries will operate between Hong Kong and Guangzhou, according to Brødrene Aa.
With a capacity of 300 passengers, two of the vessels will feature a length of 42 meters and have a maximum operating speed of 40 knots. The third vessel will measure 42 meters in length as well, however, it will have a capacity of 230 passengers and a maximum operating speed of 37 knots.
"This contract represents an important milestone in our efforts to penetrate the Chinese market," Tor Øyvin Aa, CEO of Brødrene Aa, said.
In 2015, Chinese Chu Kong Shipping made an equity investment in Brødrene Aa. The objective was to establish a joint composite manufacturing facility in China as well as to provide market opportunities for completed vessels from Brødrene Aa’s yard in Norway.
"With vessels operating long hours at speeds of 40 knots you really capitalize on the benefits of carbon fiber constructions. Lighter vessels render lower fuel consumption and reduced emissions. This contract will allow us to demonstrate the benefits our vessels bring to the markets in China and other Asian markets as well," Brødrene Aa's CEO added.
Belgium's owner and operator of gas carriers Exmar has sold the 2003-built LNG carrier Excel.
The 138,107 cbm Excel was already delivered to its new owners on October 6, 2017, the company said. However, the identity of the buyer has not been revealed.
The net cash proceeds realized by Exmar for its 50% share in the joint venture ownership of the LNG carrier will be approximately USD 23 million. Japanese MOL owns the remaining 50% in the joint venture.
Based on the valuation data from VesselsValue, the ship is worth around USD 75.8 million.
Prior to the sale, Exmar had four LNG carriers in its fleet, including Excalibur which is also owned in the form of a joint venture, while LNG Portovenere and LNG Lerici are managed vessels.
Excel has been employed uninterruptedly from December 2016 to July 2017 for Indonesian account.
The company said in July that it was exploring several employment alternatives for the vessel. Nevertheless, it seems that these efforts have not been that successful.
On the other hand, Excalibur has been chartered out on a longterm contract to Excelerate Energy until March 2022.
For the first half of 2017, Exmar said that its LNG business suffered a loss of USD -20.4 million in its operating results compared to USD 24.7 million for the first half of 2016.
The operating result was negatively impacted by a non-cash impairment of USD 22.5 million on the Excel as well as costs related to the late delivery of the CFLNG.
Spanish shipping firm Fred Olsen has placed an order for two vehicle passenger trimaran ferries at Australian-based ship building company Austal Limited.
Under the deal, valued at EUR 126 million (USD 147.7 million), Austal will construct the 117-metre high-speed ferries over a period of 29 and 36 months, respectively.
The two new trimarans will each be capable of transporting over 1,100 passengers and up to 276 cars at speeds of up to 38 knots, with both commencing construction in 2018. The exact build location for the vessels are currently not known.
Designed by Austal Australia, the aluminium trimarans will be the second and third trimarans to be delivered to Fred Olsen S.A. who already operate the world's first and largest trimaran vehicle passenger ferry, the Benchijigua Express, designed and built by Austal in 2005.
"The Benchijigua Express has become an industry benchmark for blue-water commercial ferry operations, exceeding expectations for performance, speed and customer experience in the Canary Islands," David Singleton, Austal Chief Executive Officer, said.
"This is a watershed contract for our next generation trimaran design that will deliver new levels of seakeeping, passenger comfort and efficiency, and proves the trimaran is the right tool for the job in the challenging sea conditions of the Atlantic. It is a game-changer in the market," Ben Marland, Austal Vice President of Sales and Marketing, added.
Taiwanese shipping company Franbo Lines Corp has inked a contract to buy a 51,000 dwt bulk carrier from compatriot company Taiwan Navigation.
Scheduled to be delivered by the end of November 2017, the unnamed bulker will become the company's largest ship.
Franbo Lines will pay USD 8.55 million for the 15-year-old Supramax which is expected to increase the company's profit margins.
Although its name was not disclosed, the ship is likely to be the 51,000 dwt Tai Harvest. Built at Oshima shipyard in Japan in 2002, Tai Harvest was sold by Taiwan Navigation to an unknown party in late September, VesselsValue's data shows.
The newest purchase brings Franbo Lines' fleet to twelve vessels ranging from 7,000 dwt to 46,500 dwt.