- OET announced the sale of two second hand VLCCs for $180 million.
- The company has also drawn up an agreement to acquire two ECO-design, scrubber-fitted 300,000 DWT VLCC crude tankers.
- Approximately, $40 million is expected to be generated by the sale.
- The sale will decrease the company’s fleet from seventeen to fourteen tankers.
Okeanis Eco Tankers Corp. (“OET”) has signed a memorandum of agreement for the sale of the VLCC crude tankers, says a press release published on their website.
About tanker sale agreement
Okeanis Eco Tankers Corp. (“OET”) has signed a memorandum of agreement for the sale of the VLCC crude tankers Nissos Santorini and Nissos Antiparos for a net consideration of $180 million (the “Sale Price”).
The Sale was concluded on a charter-free basis, and is anticipated to be completed upon delivery of the final vessel to her new owners by latest November 2021, says a press release on the company website.
About an acquisition agreement
In addition, the Company has entered into an agreement to acquire two ECO-design, open loop scrubber-fitted 300,000 DWT VLCC crude tankers under construction at Hyundai Heavy Industries, South Korea from entities controlled by OET’s Chairman and Chief Executive Officer, Mr. Ioannis Alafouzos, for $194 million delivering in Q1 2022 and Q2 2022, respectively.
Resale VLCCs design
The resale VLCCs are designed to operate on alternative fuels, including Biofuel, and to be retrofitted to consume lower carbon fuels such as LNG or Methanol.
They are compliant with EEDI Phase 2 requirements and fitted with a Low Pressure SCR for NOx compliance.
Company’s net asset value after acquisition
The M&A subcommittee of the Company’s Board of Directors (the “Board”) – majority-composed of Investor Directors – deemed that the three-year, age-adjusted Acquisition Price ($97 million/VLCC) compared very favourably to the Sale Price ($90 million/VLCC), and estimated that the Acquisition will be immediately accretive to the Company’s net asset value upon delivery of the resale VLCCs in 2022.
Shareholder distribution after sale
The Sale is expected to generate net proceeds of approximately $40 million after repayment of lease financing outstanding at delivery. Upon completion of the Sale, the Board intends to propose a shareholder distribution(s) of $20-23 million and OET will pay the Sponsor $17 million, representing the difference between the Acquisition Price and $177 million (the “Original Contract Price”).
Time Charter Swap
Lastly, OET announces that it has entered into an agreement to replace its time charters on the VLCCs Nissos Rhenia and Nissos Despotiko.In exchange, OET has agreed to undertake the following actions:
- Transfer the remaining ~2.0 year time charter of the VLCC Nissos Keros to a leading international energy company to the Nissos Despotiko and accelerate debt repayment of the Nissos Despotiko lease by $1.8m p.a. over the next two years.
- Transfer the remaining ~0.5 year time charter of the VLCC Nissos Donoussa to a leading national oil company to the Nissos Rhenia.
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Source: Okeanis
