Norway’s Belships has secured a new $116m loan from DNB Bank and Sparebank 1 SR-Bank that will be used to repay off its existing credit facility.
Two vessels will be left unencumbered once the process is complete.
The loan has a margin of 225 basis points and a loan-to-value ratio of 55%, the Oslo-listed company said.
The first instalment of repayments is due in 2023 and maturity is set for 2027.
Belships expects to conclude the loan agreement this quarter, once certain contractual conditions have been met.
The company had mortgage debt of $135.2m at the end of the third quarter of 2021, plus cash and cash equivalents of $106.5m, according to its most recent financial report.
The last time Belships entered into a new loan was in April 2019, when it put in place a $140m facility at a margin of 275 basis points over Libor.
That loan had been due to mature in the second quarter of 2024 and was used to expand Belships’ bulker fleet through acquisitions in the second-hand market.
Belships’ contract coverage for 2022 stands at about 65% at an average net rate of $23,000 per day per vessel. The daily cash breakeven this year is about $10,000 per vessel.
CEO Lars Christian Skarsgard told TradeWinds in January that fixing more of the fleet on period employment is of strategic value to Belships.
“During the past few months we have actively sought to secure contract coverage. We think our stock is heavily undervalued and these cash flows efficiently de-risk our earnings proposition and secures our ability to pay out dividends,” he said.
The company today has a fleet of 27 supramaxes and ultramaxes with an average age of 3.7 years.
