Capital Product Partners L.P. (NASDAQ: CPLP) announced today the acquisition of three newly-built 5,023 TEU containerships from Capital Maritime & Trading Corp.
CPLP paid $195 million for the three vessels, M/V CCNI Angol (ex Hyundai Prestige), the M/V Hyundai Privilege and the M/V Hyundai Platinum, each built in 2013 by Hyundai Heavy Industries.
CPLP notes that the vessels are under a 12 year time charter employment (+/- 60 days) to Hyundai Merchant Marine Co. Ltd. (HMM) at a gross rate of $29,350 per day. The charters commenced shortly after the delivery of the vessels during the first half of 2013.
Mr. Ioannis Lazaridis, Chief Executive and Chief Financial Officer of CPLP commented:
“We are very pleased to have entered into a new credit facility and concluded an important transaction for the Partnership with the acquisition of the three additional, eco-type, high specification 5,023 TEU container vessels, as these transactions offer long term cash flow visibility to our shareholders and further diversify our revenue stream.
“In addition, we are pleased to have extended the charters of two of our product tankers at an increased rate with our sponsor, which reflect the positive fundamentals of the product tanker market ahead. We would like to reiterate our commitment to the $0.93 per unit annual distribution guidance going forward. These transactions as well as the positive fundamentals of the product tanker market going forward, further enhance our financial flexibility in order to pursue growth opportunities and further forge a pathway to distribution growth.”
Financial details
The acquisition was mainly funded from the Partnership’s new $200,000,000 senior secured credit facility with ING Bank N.V. and HSH Nordbank AG and from the net proceeds of its public offering of 13,685,000 common units, including the exercise of the over-allotment option, which was closed on August 9, 2013, at a price of $9.25 per unit. Under the Credit Facility, the Partnership may further borrow for the financing up to 50% of the value of modern product tanker and post Panamax container vessels. The facility is non-amortizing until March 2016.
Charter Extensions
The Partnership has reached an agreement with Capital Maritime to extend the charters of 2006-built 36k dwt chemical/product tankers M/T Alkiviadis and M/T Agisilaos. CPLP notes the charters have been extended by a period of 12 months (+/- 30 days) at a gross rate of $14,250 per day, which is approximately $750-835 per day higher than their previous employment day rate. The earliest redelivery for each of the M/T Alkiviadis and the M/T Agisilaos under these charters is expected to be June 2014 and August 2014, respectively.
CPLP currently owns 30 vessels, including four Suezmax crude oil tankers, 18 modern MR (Medium Range) product tankers, seven post panamax container vessels and one Capesize bulk carrier. All of its vessels are under period charters to large charterers such as BP Shipping Limited, subsidiaries of OSG, Petrobras, A.P. Moller-Maersk A.S, Hyundai Merchant Marine Co. Ltd., Blue Marine Cargo, S.A. de C.V., Subtec S.A. de C.V., Cosco Bulk Carrier Co. Ltd. and Capital Maritime & Trading Corp.
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