London-based containership charter owner Global Ship Lease (GSL) has signed a deal to buy twelve secondhand containerships from Borealis Finance LLC.
The ships, that have an average size of approximately 3,000 TEU and a weighted average age of 11 years, will be purchased for $233.9 million.
As informed, the vessels are all on charters with unnamed liner operators, with remaining charter durations of three to 25 months.
The twelve units are scheduled for delivery during the third quarter of 2021.
GSL said it expects to fund the purchase price with cash on hand, the proceeds of new bank debt, and the issuance of $35 million of its existing 8.00% senior unsecured notes to the sellers.
“We are pleased to announce the agreement to acquire these 12 ships, which are cash flow positive from the first day, without any additional issuance of common shares. The vessels have an appealing combination of existing medium-term charter cover and upside potential in the relative near term from charter renewals in one of the strongest ever containership charter markets, in which both charter rates and durations are significantly above the levels of recent years,” George Youroukos , Executive Chairman of Global Ship Lease, commented.
“These additions to the GSL fleet will increase our exposure to the workhorse feeder and handy size segments, which are currently commanding record-high charter rates stemming from strong demand and effectively full employment, and discussions are already underway to secure additional forward cover on terms reflecting these superior market conditions.”
“Looking forward, we remain highly optimistic about both the prospects for mid-sized and smaller containerships and GSL’s ability to continue executing an accretive, charter-attached growth strategy that improves our earnings and forward visibility, while minimizing residual value risk,” he added.
Global Ship Lease owns 49 containerships and has contracted to purchase a further 13 ships, ranging from 1,118 to 11,040 TEU, with a total capacity (when fully delivered) of 322,770 TEU. 32 ships are Post-Panamax, of which nine are fuel-efficient new-design wide-beam.