The National Shipping Company of Saudi Arabia signed a murabaha financing agreement with the Saudi British Bank (SABB) and the National Commercial Bank for Saudi Riyals 822.6 millions(approx USD 219.3 million). The proceed will be utilized to finance 80% of the cost of constructing two (2) general cargo ships and 20% will be financed by the company and optional two (2) ships that were contracted with Hyundai MIPO Shipyard in South Korea.
The financing tenor will be about (12) years and will be repaid in equal quarterly installments and a balloon payment at the end of the tenor of about (30%) of the contract value. Repayment will start after three months from taking delivery of the ships. The ships will be mortgaged to the financing banks as security for the murabaha financing.
This was announced by the Chief Executive Officer Eng. Saleh Nasser Al-Jasser who added that these ships will replace the current (4) ships which are approaching the end of their estimated service lives. He also mentioned that those ships are specialized in transporting general and projects cargo and several types of RoRo cargo. The ships are equipped with heavy lift cranes and the deadweight of each ship is approx. 26,000 tons, in addition to the capability in carrying containers, in the designated area of the ship.Despite that the deadweight of these ships are less than the current ones, these ships have larger capacity utilization aspects and lower fuel consumption. The new ships will be serving as a liner between the United States East Coast to the Middle East (Red Sea-Arabian Gulf) and to the Indian Subcontinent via Europe.
Mr. Al-Jasser concluded his statement by expressing his gratitude to the financing banks for their trust and support to the company and its investment programs.
[mappress] Source: NSCSA, June 27, 2011.