Marine Link
Sunday, December 4, 2016

Scorpio Issue Shares in Newbuild Tankships Deal

September 20, 2013

Scorpio Tankers logo

Scorpio Tankers logo

Scorpio Tankers say they have agreed with certain unaffiliated third parties to issue shares in exchange for the transfer of ownership to the Company of four MR product tankers currently under construction in South Korea.

The newbuildings are expected to be delivered in the first and second quarters of 2014 and are similar to the Company's newbuildings that are also under construction at the same shipyard.

The purchase price of the four vessels, in aggregate, is approximately $151 million. Approximately 30% of the consideration for the vessels will consist of newly issued common shares of the Company having a valuation based on the fair market value of the shares at the time of issuance. The new common shares will be issued to Ceres (CERE), Valero and a group of institutional investors advised by J.P. Morgan Asset Management; the remainder of the purchase price will be paid to the shipyard from cash-on-hand and bank debt.

The transaction also includes a time charter-out agreement for each of the four vessels for a fixed daily revenue amount at current market levels plus a profit sharing scheme whereby earnings in excess of the base time charter rate will be split between the Company and charterer, Valero. The first vessel delivered will be time chartered-out for a 24 month period, and the remaining three will each be time chartered-out for 12 month periods.

Scorpio add that the transactions will be completed by way of novation of the existing shipbuilding agreements and remain subject to final documentation.

 



 
Maritime Reporter Magazine Cover Nov 2016 - Workboat Edition

Maritime Reporter and Engineering News’ first edition was published in New York City in 1883 and became our flagship publication in 1939. It is the world’s largest audited circulation magazine serving the global maritime industry, delivering more insightful editorial and news to more industry decision makers than any other source.

Subscribe
Maritime Reporter E-News subscription

Maritime Reporter E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

Subscribe for Maritime Reporter E-News