Star Bulk charters two fuel efficient newbuilding newcastlemax vessels under ten year bareboat charters
Star Bulk Carriers Corp., a global shipping company focusing on the transportation of dry bulk cargoes, today announced that it has entered into agreements with CSSC (Hong Kong) Shipping Company Limited (“CSSC”), an affiliate of Shanghai Waigaoqiao Shipbuilding Co. Ltd of China (“SWS”) to bareboat charter , two fuel efficient Newcastlemax dry bulk vessels, hull numbers 1372 and 1371 each with a cargo carrying capacity of 208,000 deadweight tons, which are currently under order at SWS , at a monthly hire rate for each CSSC vessel ranging between $371,000 to $410,800 plus LIBOR, the company said in its press release.
The bareboat charters have a 10 - year term and are expected to commence when the vessels are delivered to Star Bulk, which is scheduled for November 2015 and February 2016, respectively. Under the terms of the Bareboat Charters , Star Bulk is required to pay CSSC $ 11.3 million and $11.8 million, representing the 20% of the construction price of $56.5 million for Hull 1372 and $59.0 million for Hull 1371 respectively.
The upfront hires for each CSSC vessel will be paid in two equal installments for each CSSC vessel , the first of which shall be due shortly and the second installment shall be due upon the completion of the steel - cutting stage of th e construction of each CSSC vessel . Under the terms of the Bareboat Charters , Star Bulk has option s to purchase the CSSC vessels at any time, which are exercisable monthly, against a predetermined, amortizing balance payment whilst it has a respective obligation at the expiration of the bareboat term . Upon the earlier of the exercise of the purchase options or the expiration of the Bareboat Charters , Star Bulk will own the CSSC vessels .
This structure effectively allows the company to acquire th e CSSC vessels, upon the completion of the Bareboat Charters , with the equivalent of 80% debt financing as a percentage of the construction price s in the preceding paragraph.
About Star Bulk
Star Bulk is a global shipping company providing worldwide seabor ne transportation solutions in the dry bulk sector. Star Bulk's vessels transport major bulks, which include iron ore, coal and grain and minor bulks which include bauxite, fertilizers and steel products. Star Bulk was incorporated in the Marshall Islands on December 13, 2006 and maintains executive offices in Athens, Greece. Its common stock trades on the Nasdaq Global Market under the symbol "SBLK". Following the delivery of the newly acquired vessel, the M/V Star Sirius, Star Bulk will own a fleet of seventeen dry bulk carriers, consisting of five Capesize, two Post Panamax, two Ultramax and eight Supramax dry bulk vessels with a combined cargo carrying capacity of 1,610,935 deadweight tons and an average age of approximately 8.9 years. In addition, Star Bulk provides vessel management services to fourteen third party dry bulk vessels, including five Capesize, two Post Panamax, two Kamsarmax, two Panamax and three Supramax vessels with a combined cargo carrying capacity of 1,569,255 deadweight tons. Star Bulk has also has entered in construction contracts for eleven fuel efficient dry bulk newbuilding vessels, including five Newcastlemax vessels, two Capesize vessels and four Ultramax vessels, with a combined cargo carrying capacity of 1,643,000 deadweight tons. All of the newbuilding vessels are expected to be delivered during 2015 and 2016.
