Global Ship Lease To Add 12 Boxships To Its Fleet

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Global Ship Lease, Inc. announced its agreement to purchase 12 containerships from Borealis Finance LLC with an average size of approximately 3,000 TEU, says a press release published in Global News Wire website. 

About the agreement

Global Ship Lease, Inc.(the “Company” or “Global Ship Lease”) announced that it has agreed to purchase 12 containerships from Borealis Finance LLC with an average size of approximately 3,000 TEU and a weighted average age of 11 years for an aggregate purchase price of $233.9 million. 

The ships are all on a charter with leading liner operators, with the remaining charter duration of three to 25 months.

Company’s fleet

With these additions, the Company’s fleet will comprise 62 containerships with a total capacity of 322,770 TEU, making Global Ship Lease the eighth largest non-operating owner of containerships by TEU capacity.

The 12 vessels are scheduled for delivery during the third quarter of 2021.

Purchase price & bank debt

The Company expects to fund the purchase price with cash on hand, the proceeds of new bank debt, and the issuance of $35.0 million of its existing 8.00% Senior Unsecured Notes to the sellers.

Based on the existing charters and assuming renewals at current market rates for the four charters that come open prior to mid-2022, the newly acquired ships are expected to contribute approximately $60.5 million of Adjusted EBITDA in the first 12 months. This represents an increase of approximately 36% on Adjusted EBITDA for the 12 months ended March 31, 2021, and implies a strongly accretive Purchase Price / Annual Adjusted EBITDA multiple of approximately 3.9 times. The ships are anticipated to add approximately $1.09 of earnings per share in the first 12 months, based on today’s outstanding share count, today’s LIBOR, and other assumptions, representing an increase of approximately 70% compared to Adjusted earnings per share for the 12 months ended March 31, 2021.

Clarksons Platou Securities AS acted as sole advisor to Global Ship Lease, which was represented by Seward & Kissel LLP as legal counsel.

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Source: Global News Wire