Denmark´s Torm specialist carrier of refined oil products will add to its fleet three 2013-built MR eco product tanker vessels for USD 48.5m in cash consideration and the issuance of 1.42 million shares. The vessels that are all built at a tier 1 Korean yard and have fuel-efficient eco vessel specifications are expected to be delivered no later than 31 May 2023.
Torm purchases the three MR product tankers in a partly share-based transaction. The cash element of the transaction is expected to be financed through traditional bank financing, and in connection with each of the three deliveries the company will issue one third of the total share issuance, corresponding to 50% of the total consideration. The transaction is expected to increase the company´s fleet to 88 vessels on a fully delivered basis.
The product carrier specialist is continuing an expansion path as in January 2023 the company has purchased seven LR1 vessels built in 2011-2013, that will be financed by sale and leaseback.
Until now two of these vessels were delivered, and the rest of the vessels are expected to be delivered before the end of April 2023.
On top of this Torm said it had obtained in March 2023 commitment for USD 433m bank refinancing at attractive terms, thereby extending its debt maturities until 2028, and with the possibility to extend to 2029. The company also secured a USD 123m commitment for financing additional second-hand vessels.
Torm delivered a record high time charter equivalent (TCE) of USD 982m, and a net profit of USD 563m, in accordance with its financial review for the year ended 31 December 2022.
The company has been very active in the previous year with new sale and leaseback agreements. Specifically, in the beginning of 2022, Torm finalized the refinancing of nine specific MR vessels. The refinancing was initiated in late 2021, by executing sale and leaseback transactions.
TORM also took delivery of the LR2 newbuilding, TORM Houston, financed in a sale and leaseback transaction.
Furthermore, the company also entered in the previous year into one additional new sale and leaseback agreement to finance the purchase of the second-hand LR2 vessel, Torm Hannah. Additionally the company repaid debt on two revolving credit facilities and therefore has undrawn and committed credit facilities amounting to USD 92.6m at the end of 2022.