OSG Sells Seven Tankers

Thursday, October 13, 2005
Overseas Shipholding Group, Inc. (NYSE:OSG) announced today that it agreed to sell seven tankers to Double Hull Tankers, Inc. (DHT) in connection with DHT's initial public offering announced earlier today. In consideration, Overseas Shipholding Group, Inc. (OSG) will receive $412.6 million in cash and 14 million shares of DHT common stock, representing a 47 percent equity stake in the new tanker concern. The total proceeds to OSG value the transaction at $580.6 million, net of fees and expenses. OSG will time charter the vessels from DHT for periods of five to six and one-half years with various renewal options up to an aggregate of five to eight years depending on the vessel. The transaction is immediately accretive to earnings.

The sale of the vessels underscores OSG's strategy of actively managing the balance between owned and chartered-in vessels in its fleet. The transaction will help OSG achieve its stated goal of returning to leverage ratios and liquidity levels that existed prior to the early-2005 acquisition of Stelmar Shipping Ltd. for $1.35 billion. OSG expects to book a gain on the sale and charter back of these vessels in excess of $230 million in the fourth quarter of 2005. The gain will be deferred for accounting purposes and recognized as a reduction of time charter hire expense over the charter periods. The proceeds of the sale will be used to reduce debt. OSG plans to provide further guidance on the financial impact of the transaction for the fourth quarter and fiscal 2006 when it reports third quarter 2005 earnings on November 3, 2005.

The vessels sold to DHT include three VLCC and four Aframax tankers -- all core ships in the OSG fleet -- representing 928,600 and 413,800 deadweight tons, respectively (see additional information below). OSG will time charter these modern vessels from DHT for terms through October 2010 and April 2012, with extension options that run up to 14 and one-half years.

Maritime Reporter September 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Dredging the River Elbe: Waiting for Luxembourg

Decision delayed on the Deepening and Widening of the Navigation Channel of the Lower and Outer Elbe The Federal Administrative Court in Leipzig today adjourned

New Inspection Requirement for Ships in Paris MOU

Lloyd’s Register advises that the St. Vincent and the Grenadines Maritime Administration has issued Circular No. PSC 033 which requires additional inspections (termed

Yara Completes Acquisition of OFD Holding

Yara International ASA has obtained relevant regulatory approvals and closed the acquisition of OFD Holding Inc. (OFD) allowing the integration process to start.

Ship Sales

DOF Installer Sells Offshore Vessel

DOF Subsea AS subsidiary, DOF Installer ASA, reported the sale of one of its three sister ships, an anchor handling tug supply (AHTS) vessel, to an international buyer.

300th Tug Brokered by Marcon Int'l

Marcon International, Inc. of Coupeville, Washington reported the sale of the U.S. flag, twin screw tug “Pacific Patriot” (ex-Pacific King) from Kirby Marine Offshore to U.

G E Shipping Acquires a Supramax Bulk Carrier & Sells "Jag Prachi"

The Great Eastern Shipping Company Ltd. (G E Shipping) took delivery of a 2006-built Supramax Bulk Carrier of about 52,454 dwt. The company had contracted to buy the ship earlier this month.

 
 
Naval Architecture Navigation Offshore Oil Pipelines Pod Propulsion Salvage Ship Electronics Ship Repair Ship Simulators Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1077 sec (9 req/sec)