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International Seaways cashes out of Nakilat LNG joint venture

New York-listed shipowner International Seaways (INSW) has sold its 49.9% stake in its joint venture with Qatar Gas Transport Company (Nakilat) for $123m in cash.

The joint venture, which is now 100% owned by Nakilat, owns Q-Flex LNG carriers Al Gattara, Al Gharrafa, Al Hamla and Tembek. The four vessels are valued at a total of $489.2m according to VesselsValue.

Lois Zabrocky, president and CEO of International Seaways, commented: “Nakilat and INSW worked in partnership to conclude this transaction, demonstrating the high level of teamwork the companies have shared for over 15 years. Nakilat continues to be a very valued INSW partner and remains an important part of our ongoing commitment to our business relationships in Qatar. By monetizing our interest in the joint venture, we unlocked significant value for shareholders and further strengthened our balance sheet.”

The deal has been applauded by J Mintzmyer, lead researcher at Value Investor’s Edge.

“Excellent sale by International Seaways announced this morning. They sold the JV for $123m versus last reported book of $116m and our more conservative estimate of $100m in our NAV models,” Mintzmyer commented.

Investors also liked the deal, with shares in International Seaways rocketing up almost 15% to $23.83 on the back of the announcement.

“With tanker rates surging and this sale further opening optionality and simplifying the company, I believe they are worth at least $30,” Mintzmyer said.

The sale ends International Seaways’ involvement in gas ships. It currently ownership interests in 34 tankers and two VLCC FSOs.

Grant Rowles

Grant spent nine years at Informa Group based in London, Sydney, Hong Kong and Singapore. He gained strong management experience in publishing, conferences and awards schemes in the shipping and legal areas, working on a number of titles including Lloyd's List. In 2009 Grant joined Seatrade responsible for the commercial development of Seatrade’s Asia products. In 2012, with Sam Chambers, he co-founded Asia Shipping Media.
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