NYSE-listed Gener8 Maritime has agreed a senior secured credit facility for up to $259.6m of debt financing for the first four of its six VLCCs being built in China.
The funds have been collectively been provided by Citibank, the Export-Import Bank of China (CEXIM) and the Bank of China. The facility has a 2.0% margin over LIBOR and a 15-year amortisation profile, Gener8 said.
“We expect to close on financing for the remaining two vessels in 2016. These agreements represent a key strategic milestone for our company as we continue to expand our fleet,” said Gener8 Maritime’s chairman, Peter Georgiopoulos, in a statement today.
The debt financing has been secured against four of Gener8’s Chinese VLCC newbuildings: Gener8 Strength (delivered this quarter), Gener8 Supreme, Gener8 Success and Gener8 Andriotis.
Gener8 has already made its first drawdown from the facility, with which it has refinanced its October 21, 2015 term loan facility with Citibank.
Nine of Gener8’s 21 VLCC newbuildings have been built in China, with two under construction in the Philippines and the rest in South Korea. Of the Chinese vessels, three have already been delivered this year and the remaining six will follow in 2016.
“We believe that the ability to raise close to $2.0bn in financing during 2015 demonstrates the commitment and support we have from our lenders and their belief in the prospects of our industry,” commented Leonidas Vrondissis, Gener8 Maritime’s CFO.
In late October, Gener8 secured a term loan facility worth around $60,174,000 from Blue Mountain Capital to fund the payments remaining on one of the newbuildings due for delivery in 2016.
The company signed non-binding letters of intent in June with banks in China and South Korea to provide two new export credit facilities, which together provide for almost $1.4bn in financing for Gener8’s 21 VLCC newbuildings.