New York-listed Teekay Tankers has announced a series of asset sales as it clinched new financing worth $533m.
The company confirmed it had agreed to sell three unnamed 2003-built suezmax tankers in separate deals for a combined $57m.
The first ship was delivered to the buyer in December, and the remaining two are expected to be handed over next month.
In December, TradeWinds reported that the company, a spin-off of Vancouver-based Teekay Corp, had sold one of its oldest suezmax tankers in what appeared to be part of a fleet renewal.
Brokers in the US and in Europe said the 165,000-dwt Ashkini Spirit (built 2003) had gone to Charalambos Mylonas-led Transmed Shipping for at least $19.4m.
VesselsValue estimated the tanker was worth $18.7m. Ashkini Spirit is not due for special survey until March 2023.
Greeks pounce on tonnage
And earlier this month, TradeWinds reported that the 159,200-dwt Narmada Spirit (built 2003) had gone to New Shipping, the company controlled by major Greek shipping player Adam Polemis, for around $19m.
And the 165,300-dwt Iskmati Spirit (built 2003) was acquired by Greece's Chemnav Shipmanagement for the same price, marking its entry into the suezmax segment.
Proceeds from the three sales will be used to cut debt, including $30m secured on the tanker trio.
Fearnley Securities said: "We expect Teekay Tankers to continue to divest older assets as the cycle matures."
And it is forecasting "significant cash flow generation" for the fourth quarter, with suezmax rates at $41,000 per day and aframaxes at $33,000, resulting in an Ebitda of $134m.
Part of support business sold
Teekay Tankers has also reached an agreement with investor Hili Ventures to sell a portion of its oil and gas ship-to-ship transfer support services business, which also provides gas terminal management and gas consulting services, for $26m.
The sale is expected to close late in the first quarter of 2020 or early in the second quarter of 2020.
Teekay is however retaining its entire lightering business that operates in the US Gulf, providing ship-to-ship transfers for both US crude imports and exports.
It will also continue to operate its oil ship-to-ship transfer support services in North America and the Caribbean.
Credit facility scaled back
The new $533m five-year revolving credit facility refinances 31 vessels. It did not name the banks involved.
The amount has been reduced since the term sheet was signed in November, after it excluded five tankers from the revolver.
These include the three offloaded suezmaxes. The other two ships are being lined up for "further opportunistic vessel sales," it said.
The cash will repay $455m of the company’s existing debt on similar terms.
Balloon maturities have been extended from 2020 and 2021 until the end of 2024.
Including the agreed asset sales and the new debt facility, the company’s liquidity is expected to increase by $73m.
“We are excited to announce these opportunistic asset sales for combined proceeds of approximately $83m, which is consistent with our strategy...and accelerates our planned balance sheet deleveraging efforts,” said CEO Kevin Mackay.
“The sale of a portion of our ship-to-ship transfer business also allows us to focus and simplify our core business of crude oil and clean product shipping."
He added that by retaining the lightering business in the US waters of the Gulf of Mexico, the company will continue to rake in the benefits of growing US import and export volumes.
“We are also grateful for the continued strong support we receive from our bank group, as represented by our new $533m debt facility, which was approximately two times oversubscribed, and provides the company with increased financial flexibility,” he said.
The company has 55 tankers, including 29 suezmaxes, 17 aframaxes and nine LR2s.
It charters in another six tankers, and has interests in five ship-to-ship support vessels, plus a 50% holding in a VLCC through a joint venture.
