Danaos Corporation has exercised its option to acquire the remaining equity interests in its joint venture Gemini Shipholdings Corporation.
Gemini is a Marshall Islands company incorporated in August 2015 and beneficially owned 49% by Danaos Corporation and 51% by Virage International, a company controlled by Danaos Corporation’s largest stockholder.
The company is buying 51% of Gemini for $86.7 million in cash, while the net cash outflow for the company will be approximately $72.3 million, which is the purchase price net of $14.4 million of the Gemini cash balance on June 30, 2021.
Gemini owns a fleet of five containerships, with an aggregate capacity of 32,531 TEU, each of which is employed on a time charter.
Contract coverage for the Gemini vessels stands at 100% for the next 12 months while the weighted average contract duration of the Gemini fleet is 3.8 years.
Upon completion of the acquisition, Danaos will own 100% of Gemini and consolidate Gemini within its financial results.
Danaos expects the consolidation of Gemini to boost its contracted revenue by approximately $160 million and its contracted EBITDA by approximately $117 million in total.
Gemini’s total debt and net debt, which will be assumed and consolidated by the company, stand at $45 million and $30.6 million, respectively.
Danaos Corporation has a fleet of 65 containerships aggregating 403,793 TEUs, including the five vessels owned by Gemini Shipholdings Corporation.