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December 19, 2019

Capital Product Partners acquires three container vessels

Greek shipping firm Capital Product Partners (CPP) has acquired three container vessels from Capital Maritime & Trading in a $162.6m deal.

Greek shipping firm Capital Product Partners (CPP) has acquired three container vessels from Capital Maritime & Trading in a $162.6m deal.

The three 10,000 twenty-foot equivalent unit (TEU) sister container vessels are called M/V Athos, M/V Aristomenis and M/V Athenian.

The company said that it will fund the acquisition ships with $47.1m cash-at-hand and two financing arrangements.

To fund the acquisition of M/V Aristomenis and M/V Athos, the company entered a sale and leaseback agreement with CMB Financial Leasing for up to $38.5m for each vessel.

The company has signed a term loan deal with Hamburg Commercial Bank for up to $38.5m to fund M/V Athenian acquisition.

South Korean shipbuilder Samsung Heavy Industries constructed the ships in 2011. They are currently under long-term charters with Hapag-Lloyd scheduled to be completed in April 2024.

The deal was signed on an arm’s length basis and was reviewed and unanimously approved by the board of directors and its conflicts committee.

Capital Product Partners has signed a term sheet with ICBC Financial Leasing to divest and leaseback three ships that are currently mortgaged under its 2017 credit facility for $155.4m. The vessels include CMA CGM Amazon, CMA CGM Uruguay and CMA CGM Magdalena.

Capital Product Partners CEO Jerry Kalogiratos said: “We are very pleased to announce today two important transactions for the Partnership. The acquisition of the three 10,000 TEU container vessels substantially increases our distributable cash flow per unit while maintaining cash flow visibility as the vessels’ charters run into 2024.

“At the same time, we are increasing the size of our fleet by approximately 30%, further expanding into the attractive Neo-Panamax container segment and diversifying our customer base with the addition of Hapag Lloyd.

“Furthermore, the partial refinancing of our 2017 credit facility is expected to lower the overall debt amortisation schedule of the Partnership by $4.3m per year, as well as the weighted average interest margin while also generating additional liquidity for the Partnership that can potentially fuel further growth.”

Last November, CPLP signed a $1.65bn definitive transaction agreement to with DSS to merge their crude tanker fleet.

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