Greek owner Capital Product Partners has entered into an umbrella agreement with Capital Maritime and Capital GP for the acquisition of 11 newbuild LNG carriers from the Evangelos Marinakis-led company for a total acquisition price of $3.13bn.
The 11 vessels in question are all two-stroke Mark III Flex 174,000 cu m LNG carriers either built or under construction at Hyundai Heavy Industries and Hyundai Samho Heavy Industries in South Korea.
The move will see the company move away from containerships and focus purely on LNG carriers. Back in July, it already exited the dry bulk sector with the sale of its only capesize, Cape Agamemnon. The company will also rebrand to Capital New Energy Carriers which is expected to become effective by December 31, 2023.
Only one of the vessels, the Amore Mio I, has been delivered and will start a 2.8-year time charter with Qatar Energy Trading in December. Three vessels set for delivery in 2024 already have contracts. Axios II has a seven-year bareboat charter deal plus three years in options with Bonny Gas, Assos won a ten-year time charter deal with Tokyo LNG Tanker Co, and Apostolos has lined up a charter by Jera for 10.5 years with three years in options. The last one is Aktoras which won a seven-year bareboat charter with BGT.
The Archimidis, Agamemnon, Alcaios I, and Antaios I will be delivered during 2026 while the final two – the Athlos and Archon – will be delivered by March 2027.
According to the company, the vessels will be purchased through the acquisition of 100% of the equity interests in the applicable vessel-owning company. As Amore Mio I has already been delivered, the acquisition of this vessel was financed through a $196.3m sale and leaseback transaction between the vessel-owning company and CMB Financial Leasing.
For the vessel-owning companies of the Axios II, Assos, Apostolos, Aktoras, Archimidis, and Agamemnon a 10% deposit will be paid at the closing date. Each vessel will be bought after its construction completion and delivery from the shipbuilder. On delivery of these vessels, the company will pay a total of around $1.6bn
The vessel-owning companies of Alcaios I, Antaios I, Athlos, and Archon will be acquired on the closing date, and Capital Product Partners will take over their obligations under the respective shipbuilding contracts with Hyundai. The company expects that the total amount due on or about the closing date to Capital Maritime will be $454.2 million. Hyundai will also be paid an additional amount of $910m in pre-delivery and delivery instalments. The closing date is expected to occur by year-end 2023 upon the closing of the rights offering.
To finance a portion of the purchase price for the vessels, Capital Maritime has agreed to issue an unsecured seller’s credit to us in an amount of up to $220m at a fixed rate of 7.5%, repayable on June 30, 2027. Also, Capital Product Partners will conduct a rights offering to finance $500m of the purchase price.
As part of the company’s focus switch on the LNG carrier market, Capital Maritime has agreed to grant Capital Product Partners rights of first refusal over transfers of LNGC vessels owned by Capital Maritime to third parties, opportunities to order newbuild LNG vessels of which Capital Maritime becomes aware, and employment opportunities for LNG vessels of which Capital Maritime becomes aware, in each case, for a period ending on the tenth anniversary of the closing date.
Also, the company has first refusal for transfers to third parties of two LCO2 carriers and two ammonia carriers recently ordered by Capital Maritime for a period ending when Capital Maritime and its affiliates no longer beneficially own at least 25% of the issued and outstanding common units.
