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

Legal

Italian Pleads Guilty to Marine-hose Price-fixing in US

A former executive of Parker ITR Srl pleaded guilty on Thursday to conspiring to rig bids for marine hose and was sentenced to two years in prison, the U.S. Justice Department said on Thursday.

Court: Japan's Mitsui Paid to Release Ship

China Supreme Court says Mitsui pays about $29 mln; Ship released about 0030 GMT Thursday. Ship was seized over dispute dating back to 1930s. Advisor to plaintiffs says will likely demand more money.

Lawyer: Korea Ferry Owners Accept Responsibilities

The family that has a major stake in companies that control the shipping operator whose ferry sank last week, likely to have killed hundreds, will take social and

Ship Sales

Brokers Marcon Conclude Ocean Deck Barge Sale

Marcon International, Inc. of Coupeville, Washington says that Pacific Coast Maritime, Inc., Seattle, Washington, a subsidiary of Harley Marine Services, Seattle,

Kvichak-built Hovercraft for Sale

The 95’ BHT-150 hovercraft SUNAX, built by Kvichak Marine Industries and owned and operated by Aleutians East Borough, is for sale through public competitive bid.

Litigation Can Cost Shipbrokers an Arm & a Leg

A survey of London solicitors by specialist intermediaries insurer ITIC has highlighted the high cost of litigation for shipbrokers and others seeking judgment in the English courts,

 
 
Maritime Careers / Shipboard Positions Naval Architecture Navigation Offshore Oil Pipelines Port Authority Salvage Ship Electronics Ship Simulators Winch
rss | archive | history | articles | privacy | 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: 0.0975 sec (10 req/sec)