Capital Product Partners Adds 10,000 TEU Boxship Trio
Capital Product Partners L.P. has agreed to acquire three 10,000 TEU sister container ships for USD 162.6 million from Capital Maritime & Trading Corp.
The ships, M/V Athos, the M/V Aristomenis and the M/V Athenian, were built in 2011 at Samsung Heavy Industries S. Korea.
The vessels are under long-term time charters with Hapag-Lloyd which will expire in April 2024.
The gross charter rate for each vessel currently amounts to USD 27,000 per day, increasing to USD 28,000 per day for the M/V Aristomenis from October 2020, and from July 2021 onwards for the M/V Athos and the M/V Athenian. The time charters include two one-year options at USD 32,500 and USD 33,500 gross per day, respectively.
The partnership intends to fund the acquisition with approximately USD 47.1 million cash at hand and two financing arrangements. Specifically, M/V Aristomenis and M/V Athos will be financed through a sale and leaseback transaction, entered into with CMB Financial Leasing Co., for an amount of up to USD 38.5 million each, while the M/V Athenian will be financed through a term loan entered into with Hamburg Commercial Bank A.G. for up to USD 38.5 million.
The lease has a duration of five years and includes a purchase option for the partnership to acquire each vessel on the expiration of the lease at the predetermined price of USD 22.5 million or pay the amount of USD 7.5 million to CMBFL, if the option is not exercised. The company has various purchase options commencing from the first year anniversary of the lease.
The average fleet age of the partnership following the transaction will be 7.7 years and the average remaining charter duration will stand at 4.6 years. With the three ships, Capital Product Partners’ fleet will comprise 14 ships including 13 Neo-Panamax container vessels and one Capesize bulk carrier.
Separately, the company said it had entered into a term sheet with ICBC Financial Leasing for the sale and leaseback of three vessels currently mortgaged under its 2017 credit facility for a total amount of USD 155.4 million. The ships in question are CMA CGM Amazon, CMA CGM Uruguay, and CMA CGM Magdalena.
The estimated repayment amount required to release these three vessels is USD 134.9 million. Principal repayments under the ICBCFL lease, amount to USD 2.8 million per quarter. The lease has a duration of 7 years after drawdown and includes mandatory purchase obligations at the predetermined price of USD 77.7 million in total. In addition, the partnership has various purchase options from the first year of the lease.
The partial refinancing is expected to generate approximately USD 20.5 million of additional liquidity for the partnership.
The ICBFL lease is subject to customary closing conditions.