Australian livestock company Wellard has agreed to sell its 2009-built livestock carrier Ocean Swagman to Heytesbury Cattle Company for $22m.
Under the agreement Wellard will charter the vessel, which has a capacity of 7,000 cattle, from Heytesbury until March 2021 with an option to extend for another four years.
The sale is part of Wellard’s plan to restructure, reduce debt, and improve its poor financial performance.
Heytesbury bought into Wellard in 2017 and now owns 11.42% interest of the company.
“Heytesbury’s purchase of the Ocean Swagman provides an attractive opportunity for Wellard to realise the equity value in the ship, while retaining continued use of the vessel for chartering or exporting opportunities,” said Wellard executive chairman John Klepac.
“Heytesbury has a deep understanding of the business, and we look forward to continuing our very productive working relationship,” Klepac added.
Following the sale, Wellard expects to reduce its overall debt from around $85m to $64m.