BW LPG Inks Term Sheet for New USD 150 Mn Loan

Owner and operator of LPG vessels BW LPG is in the documentation stage for the refinancing of its existing USD 150 million unsecured revolving credit facility maturing in March 2018. 

Namely, the company signed a committed term sheet for the new USD 150 million, five-year senior secured term loan on November 8.

The move has been announced in the company’s financial results for the third quarter of this year which was, according to BW LPG, “the most challenging quarter for the VLGC spot market since 2009.”

During the quarter, the company’s VLGC rates averaged USD 15,200 per day, compared to USD 22,100 recorded in the same quarter of 2016. What is more, LGC TCE rates averaged USD 13,600 per day in the three-month period ended September 30, 2017, against USD 15,900 seen in Q3 2016.

TCE income stood at USD 70.1 million in Q3 2017, against USD 80.5 million reported in the same period a year earlier.

Loss after tax was USD 26.7 million in the third quarter of 2017, compared to USD 60.4 million posted in Q3 2016. As informed, this was primarily due to depressed LPG spot rates and lower fleet utilization, USD 3 million in accelerated depreciation of two LGC vessels and a USD 2.6 million impairment charge on a vessel that was reclassified to asset held-for-sale.

In October 2017, the company established the previously announced joint venture in India – BW Global United LPG India Private Limited. Created in collaboration with Global United Shipping India Private Limited, the joint venture will own and operate gas carriers for the transportation of LPG within Indian waters. As part of the agreement, BW LPG has sold two of its vessels, BW Boss and BW Energy, to the joint venture company. The two VLGCs owned by the joint venture will be converted to Indian flag to secure Indian business employment, according to BW LPG.

Currently, the company has a fleet of 50 vessels, comprising 46 VLGCs and four LGCs. In addition, BW LPG has two time charter-in VLGC newbuilds that are under construction.

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