Dry bulk owner 2020 Bulkers, with offices in Bermuda and Norway, has signed an agreement to sell its 2019-built newcastlemax vessels ‘Bulk Shanghai’ and ‘Bulk Seoul’ to an unaffiliated third party for a total consideration of $127.5m.
The Oslo-listed owner didn’t disclose the name of the buyer but revealed that the two ships are currently owned by Ocean Yield under a sale leaseback arrangement.
The sale is subject to certain closing conditions, in line with industry standards, and the company has exercised its option with Ocean Yield to effectuate the sale.
The company will retain the vessels’ operating cashflow until closing of the transaction, which is expected to take place no later than May 1, 2024. Assuming the two vessels each perform two more China-Australia round voyages, based on the current FFA curve, cash flow during the period is estimated to be approximately $3.5m.
2020 Bulkers expects to recognize a net book gain of around $40m upon completion of the transaction.
As a result of the transaction, 2020 Bulkers estimated cash breakeven will be reduced by $1,900 per day to $14,500 per day and the company’s average gross debt per vessel will decrease from approximately $25.7m to approximately $23.7m.
The newcastlemax owner will, subject to completion of the sale, determine the allocation of the net proceeds from the transaction, which may include further debt repayments or a return of capital to shareholders.
2020 Bulkers has eight newcastlemax dry bulk vessels in operation and all vessels are fitted with exhaust scrubber systems.
