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 Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter May 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

China Slams South China Sea Case as Court Set to Rule

An international court said on Wednesday it would deliver a hotly anticipated ruling in the Philippines' case against China over the South China Sea on July 12,

CMA CGM Crosses 91.05% Ownership Threshold of NOL

CMA CGM S.A has crossed the compulsory acquisition ownership threshold in Neptune Orient Lines Limited (NOL).    Following its all-cash voluntary conditional

ECDIS Related Detentions on the Rise

ClassNK has been informed by Australian Maritime Safety Authority (AMSA) that during PSC inspections it has been increasingly reported that vessels have been detained

Ship Sales

Navig8 Chemical Adds New Tanker from Kitanihon

Chemical shipping company Navig8 Chemical Tankers Inc. has taken delivery of its first stainless steel chemical tanker, the Navig8 Sirius, from Japanese shipbuilder Kitanihon Shipbuilding Co.

Hanjin to Return 38 Vessels Next Year

Hanjin Shipping is planning to return a total of 38 chartered vessels once their contracts end as part of its restructuring efforts, reports the Korea Herald. A

Wan Hai Orders Eight New Containerships

Taiwan’s shipping company Wan Hai Lines has placed an order for eight 1,900 teu box ships worth a total of $212 million - $236 million.   Wan Hai said that the

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Port Authority Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction 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: 0.0659 sec (15 req/sec)