Newcastlemax owner 2020 Bulkers has sold two 2019-built bulkers to an unaffiliated third party for a total consideration of $127.5m.
The company said that it sold the Bulk Shanghai and Bulk Seoul, currently owned by Ocean Yield under a sale and leaseback arrangement. The company exercised its option with Ocean Yield to effectuate the sale.
2020 Bulkers will retain the vessels’ operating cash flow until the closing of the transaction, which is expected to take place no later than May 1, 2024. Assuming the two vessels each perform two more China-Australia round voyages, based on the current FFA curve, cash flow during the period is estimated to be around $3.5m.
The company expects to recognise a net book gain of approximately $40m upon completion of the transaction.
As a result of the transaction, 2020 Bulkers estimated cash breakeven will be reduced by $1,900 per day to $14,500 per day and the company’s average gross debt per vessel will decrease from approximately $25.7m to approximately $23.7m.
The newcastlemax owner will, subject to completion of the sale, determine the allocation of the net proceeds from the transaction, which may include further debt repayments or a return of capital to shareholders.
Following the completion of the sale of the two vessels, the company’s fleet will consist of two 2019-built bulkers – the Bulk Sandefjord and the Bulk Santiago – and four more 2020-built vessels – the Bulk Shenzhen, Bulk Sydney, Bulk Sao Paulo, and Bulk Santos.
