General Maritime Corporation Announces Agreement to Acquire Seven Modern Tankers
Thursday, 10 June 2010
General Maritime Corporation announced yesterday that it has agreed to acquire five Very Large Crude Carriers (VLCCs) built between 2002 and 2010 and two Suezmax newbuildings from companies affiliated with the Metrostar Management Corporation for an aggregate purchase price of approximately $620 million.
The acquisition is subject to financing conditions and the completion of customary documentation and closing conditions.
The seven double-hull vessels are expected to be delivered to General Maritime between July 2010 and April 2011.
Following the completion of the acquisition, the Company expects to own a fleet of 38 double-hull tankers.
The fleet would consist of seven VLCCs, thirteen Suezmax tankers, twelve Aframax, two Panamax and four Handymax product tankers, with an aggregate carrying capacity of approximately 6.0 million dwt.
General Maritime has entered into a commitment letter with Nordea Bank Finland plc and DnB NOR to finance up to 60% of the purchase price for the seven vessels.
The commitment letter contemplates a five-year $372 million senior secured credit facility, which would be comprised of a senior secured delayed-draw term loan facility in the aggregate principal amount of up to $372 million, $50 million of which would convert to a revolving credit facility.
The Company plans to borrow the full amount under the proposed new credit facility for the proposed vessel acquisitions and intends to explore various alternatives to finance the remaining portion of the purchase price for the proposed vessel acquisitions.
John P. Tavlarios, President of General Maritime Corporation, commented, "We are pleased to continue our tradition of entering into value-creating transactions for shareholders and have once again seized an attractive opportunity to consolidate the tanker market.
With this acquisition, we expect to grow our high-quality fleet by approximately 50% on a tonnage basis, further improve the age profile of our fleet and increase our presence in the attractive VLCC market.
General Maritime's exposure to a number of oil tanker subsectors and the product sector combined with its flexible fleet deployment strategy, position the Company to maximize long-term cash flow and achieve a level of stability in results."
Jeffrey D. Pribor, Chief Financial Officer of General Maritime Corporation, stated, "Since its inception, General Maritime has remained committed to actively consolidating the industry in a manner that meets a strict set of return criteria.
In maintaining our disciplined approach, we have entered into an agreement to acquire seven modern vessels at a price we believe to be favorable and accretive to earnings per share and will increase the Company's long-term earnings power.
We continue to receive support from world-class banks and have already obtained a commitment letter to finance up to 60% of this acquisition."
General Maritime Corporation is a leading provider of international seaborne crude oil transportation services. General Maritime also provides transportation services for refined petroleum products.
General Maritime's vessels operate principally within the Atlantic basin, which includes ports in the Caribbean, South and Central America, the United States, West Africa, the Mediterranean, Europe and the North Sea.
General Maritime also currently operates tankers in other regions including the Black Sea and Far East.
Currently, General Maritime owns a fully double-hull fleet of 31 tankers - two VLCCs, eleven Suezmax tankers, twelve Aframax, two Panamax and four Handymax product tankers - with a total carrying capacity of approximately 4.0 million dwt.
Source: General Maritime Corporation
http://www.hellenicshippingnews.com/index.php?option=com_content&task=view&id=105402&Itemid=94
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General Maritime Corporation/ Website:
http://www.generalmaritimecorp.com/our-fleet.aspx
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