CSAV restructures post-panamax order
In another important step towards securing its future, Chilean shipping group CSAV has restructured orders to build seven post-panamax boxships at South Korean and Taiwanese yards.
CSAV’s ambitious expansion plans put in place in 2007 by former president Ricardo Claro have been downgraded, with a 15% reduction in the overall capacity to be added to the company’s container fleet and deliveries pushed back by as much as a year.
Four 12,600 teu container vessels ordered at Samsung Heavy Industries at a cost of $644m in July 2007 have been converted into an order for five 8,000 teu vessels valued at $125m each.
The move cuts $19m off the troubled group’s newbuilding commitments but pushes up the slot cost of the order by as much as 20%.
While the vessels were originally due in 2010 and 2011, they will now be delivered between mid-2011 and the first half of 2012.
For CSAV’s trio of 6,600 teu vessels on order at Taiwanese yard CSBC, the company has negotiated a seven-month delay in delivery.
The vessels are now scheduled for completion between April 2010 and April 2011. The first of these vessels was due to be delivered this year.
Financing for the ships has been put in place with a group of creditors led by French bank, BNP Paribas.
In a statement to the Chilean stock exchange, CSAV chief executive Juan Antonio Alvarez said the company had reached an agreement with the banks to fund 70% of the cost of the five 8,000 teu vessels with the debt priced at 350 points over the London interbank offered rate, with payments scheduled over 12 years.
Two of the 6,600 teu vessels will be financed on the same terms but over a period of 10 years while talks are ongoing to secure finance for the final vessel at 65% of the vessel’s value at the same rate but paid back over a shorter five-year term, he said.
The consortium of banks that agreed a debt package of $675m for the original seven vessels in November 2007 included French banks, BNP Paribas and Credit Industriel Commercial and the Import-Export Bank of Korea.
Terms of the debt are indicative of the complications facing shipowners seeking to re-negotiate with banks and yards in the current financial climate.
Whereas the original debt package was priced at an average of Libor plus 0.9% and stretched to 75% of the value of the vessels, the latest $612m debt package has been priced at Libor plus 3.5% and leaves CSAV looking to find another 5% in equity to pay for the ships.
At today’s 12-month Libor rate of 1.5% the overall pricing is favourable when compared to the 12-month base rate of 4.6% in November 2007.
*CSAV shareholders today voted to move ahead with a $300m fund-raising programme at an emergency shareholders meeting held in Valparaiso.
CSAV’s ambitious expansion plans put in place in 2007 by former president Ricardo Claro have been downgraded, with a 15% reduction in the overall capacity to be added to the company’s container fleet and deliveries pushed back by as much as a year.
Four 12,600 teu container vessels ordered at Samsung Heavy Industries at a cost of $644m in July 2007 have been converted into an order for five 8,000 teu vessels valued at $125m each.
The move cuts $19m off the troubled group’s newbuilding commitments but pushes up the slot cost of the order by as much as 20%.
While the vessels were originally due in 2010 and 2011, they will now be delivered between mid-2011 and the first half of 2012.
For CSAV’s trio of 6,600 teu vessels on order at Taiwanese yard CSBC, the company has negotiated a seven-month delay in delivery.
The vessels are now scheduled for completion between April 2010 and April 2011. The first of these vessels was due to be delivered this year.
Financing for the ships has been put in place with a group of creditors led by French bank, BNP Paribas.
In a statement to the Chilean stock exchange, CSAV chief executive Juan Antonio Alvarez said the company had reached an agreement with the banks to fund 70% of the cost of the five 8,000 teu vessels with the debt priced at 350 points over the London interbank offered rate, with payments scheduled over 12 years.
Two of the 6,600 teu vessels will be financed on the same terms but over a period of 10 years while talks are ongoing to secure finance for the final vessel at 65% of the vessel’s value at the same rate but paid back over a shorter five-year term, he said.
The consortium of banks that agreed a debt package of $675m for the original seven vessels in November 2007 included French banks, BNP Paribas and Credit Industriel Commercial and the Import-Export Bank of Korea.
Terms of the debt are indicative of the complications facing shipowners seeking to re-negotiate with banks and yards in the current financial climate.
Whereas the original debt package was priced at an average of Libor plus 0.9% and stretched to 75% of the value of the vessels, the latest $612m debt package has been priced at Libor plus 3.5% and leaves CSAV looking to find another 5% in equity to pay for the ships.
At today’s 12-month Libor rate of 1.5% the overall pricing is favourable when compared to the 12-month base rate of 4.6% in November 2007.
*CSAV shareholders today voted to move ahead with a $300m fund-raising programme at an emergency shareholders meeting held in Valparaiso.
