United Arab Shipping Company (UASC) closed a $ 1.25 billion multi-tranche syndicated loan facility for the partial financing of seven 14,000 TEU container ships and five 18,000 TEU container ships.
The Facility is part of a larger $1.74 billion debt financing related to UASC’s announced $2.3 billion capital expenditure program for 17 newbuilding container vessels including, in total, 11 x 14,000 TEU and 6 x 18,000 TEU vessels.
Deutsche Bank AG, London Branch (DB) acted as Global Coordinator to UASC for the entire $1,74 billion debt financing. The 17 vessels include ten vessels for which shipbuilding contracts were signed in August 2013 with the remaining seven vessels being option vessels.
The process of option vessels is still continuing.
UASC has ordered the ultra large container ships from Hyundai Heavy Industries Co. Ltd. shipyard in South Korea. The giant box-ships, which are state of the art vessels capable of running on conventional fuel and liquefied natural gas, are scheduled for delivery between November 2014 and January 2016.
All tranches are fully repaid within 12 years from drawdown. The transaction was closed in an accelerated time frame within 3 months of formal launch. The landmark deal is one of the largest ship financing deals of 2013 and is testament to the excellent relationships that UASC enjoys with K-sure and its lenders.
Mr. Basil Al-Zaid, UASC Chief Financial Officer, commented on the occasion of the closing of the syndicated loan facility: “In a capital intensive industry like container shipping, it is critical to invest in new assets to keep up with market growth and to expand. The unwavering commitment of our shareholders as well as the excellent support from our regional and international lenders has been fundamental to the successful closing of this Facility. The oversubscription to the Facility by 2.2 times also shows the financial strength of UASC.”
Mr. Jorn Hinge, UASC President & Chief Executive Officer, also remarked: “We are first-movers with these ‘Green’ newbuildings that will be equipped for LNG duel fuel for the first time in the long haul container trades. UASC is proud to continue its commitment to energy efficiency and environmental friendliness. As the UASC vision is ‘Linking the Middle East to the World’ we appreciate especially that numerous regional Middle East banks have been involved in supporting this Facility.”
The $493 million debt financing for the remaining five vessels is expected to be closed shortly under separate facilities.
Press Release, December 19, 2013