Seaspan does it again…
The Hong Kong- based containership lessor company today announced long-term charters with Israeli liner ZIM Integrated Shipping Services (NYSE: ZIM) for ten “ultra-modern” LNG-powered newbuild containerships with 7,000 TEU capacity. Seaspan is expected to enter into shipbuilding agreements for the ships with a “major shipyard” which will bring its newbuild orderbook to a whopping 55 vessels.
All 55 shipbuilding orders have been placed since December 2020. During that time, the company has also purchased four secondhand ships which have all be delivered, increasing its fleet to 131 ships currently.
The ten ships announced today are planned for delivery in the fourth quarter of 2023 and through 2024. Seaspan said the order has an aggregate purchase price of $1.05 billion, which is anticipated to be financed from existing liquidity, cash flow from operations, and additional borrowings.
Seaspan said the long-term charters with ZIM will span 12 years will generate approximately $1.8 billion of gross contracted cash flow.
“We are very pleased to collaborate with ZIM on this forward-thinking project which provides advanced designs, competitive pricing and valuable deliveries,” said Bing Chen, Chairman, President and CEO of Seaspan. “We see these modern 7,000 TEUs to be the natural successor to the aging global pool of conventional vessels in the 4,000 to 9,000 TEU range, where relatively little fleet renewal has taken place. We are experiencing strong customer interest for this vessel size.”
Seaspan, a wholly owned subsidiary of Atlas Corp. (NYSE:ATCO), is a leading independent owner and operator of containerships that it typically charter on long-term, fixed-rate time charters to the world’s largest container shipping liners.
As of March 31, 2021, Seaspan’s fleet consisted of 127 containerships representing total capacity of approximately 1,073,200 TEU. The addition of the four second-hand ships and 55 ships under construction will increase its fleet to 186 and 1,854,200 TEU on a fully delivered basis.
“We continue to execute on our growth plan in a prudent manner,” said Graham Talbot, CFO of Seaspan. “In line with all of our vessel investments, we have de-risked the $1.05 billion capital expenditure associated with the dual-fuel LNG Containerships by signing long-term charters with a leading global liner representing approximately $1.8 billion of contracted cash flow. We intend to maintain balance sheet and risk management integrity while continuing the growth track that we have established over Seaspan’s 20-year history. We remain diligent on our path toward an investment grade credit rating, and operational scale will play an important role in this pursuit.”
Seaspan’s Newbuild Orderbook
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