The new vessels being built by Hyundai Mipo Dockyard will be used to cater to the growing demand for the import of essential grains into Saudi Arabia. Credit: Bahri.

Bahri Dry Bulk has secured a SAR360m ($96m) loan from Saudi Arabia’s Bank Albilad to finance the acquisition of four new bulk carriers.

The Sharia-compliant funding is intended to support a $120m contract that was signed between Bahri Dry Bulk and South Korean shipbuilder Hyundai Mipo Dockyard (HMD)in August last year.

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The newly secured credit facility is scheduled to be paid over six months and has a 13-year tenure, including a three-year grace period.

It will be used to fund 80% of the vessel contract.

"The new funding from Bank Albilad is a major milestone for Bahri Dry Bulk as we are keen on expanding our business into new markets in the region."

Bahri Dry Bulk president Nezar Banabeela said: “The new funding from Bank Albilad is a major milestone for Bahri Dry Bulk as we are keen on expanding our business into new markets in the region and globally, to explore new horizons of growth and play a key role in supporting the Kingdom in achieving the national goals and strategic directions of the government.

“Moreover, with the addition of four new carriers to our fleet, we will be fully equipped to cater to the increasing demand for essential grains such as barley, wheat, and corn in the country.”

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Bahri has already submitted all the necessary guarantees required to receive the loan to Bank Albibad, including a pledge for the four ships upon delivery.

Each of the new vessels will have the capacity to carry up to 80,000t of cargo per voyage and are expected to be delivered in 2020.

The new carriers are to be built by Hyundai Mipo Dockyard and will be used to address the growing demand for the import of essential grains into Saudi Arabia.