Korea Finance Corporation announced on July 10 that it signed a USD263 million financing agreement as part of a syndicate which included Korea Development Bank and Kookmin Bank. The agreement is for the purchase of 10 MR tankers by Sinokor Petrochemical Co. Ltd., a mid-sized shipping company in Korea.
The tankers were contracted to Hyundai Mipo Dockyard Co. Ltd. after Sinokor signed a seven-year time charter agreement with Shell. KoFC participated as a senior lender along with other Korean financial institutions. The principal and interest will be repaid through the charter hire. The remaining portion needed for the purchase was financed via subordinated loans extended by Korea Ship Finance Co. and Korea Marine Finance Corporation.
“I hope the signing today will serve as an opportunity to facilitate Korean small- and mid-sized shipping companies’ expansion into the global market,” said Jae Kyong Jung, General Manager of KoFC’s International Banking Department . “To help small-and mid-sized shippers overcome the financial strain from the on-going downturn in the industry, KoFC will continue to leverage its various instruments including direct lending and ship finance on-lending to provide consistent support,” he added.
In June, KoFC has financed the purchase of one VLGC (very large gas carrier) for KSS Line, a medium-sized shipping company, to be built by Hyundai Heavy Industries. KoFC is waiting to close another financing deal for a medium-sized shipper in August.
In addition to direct lending, KoFC continues to utilize the on-lending program, its primary financing tool, as a channel for persistent ship financing support. Last year, KoFC established on-lending agreements with KDB Capital and Korea Exchange Bank and supported Polaris Shipping’s VLOC (very large ore carrier) purchase.
KoFC, July 11, 2013