Global Ship Lease announces agreement to acquire seven Post-Panamax containerships on multi-year charters
Global Ship Lease, Inc. has agreed to purchase and charter back seven 6,000 TEU Post-Panamax containerships with an average age of approximately 20 years for an aggregate purchase price of $116 million, according to the company's release.
The charters are to leading liner operators for a minimum firm period of 36 months each, followed by two one-year extensions at charterer’s option. The vessels are expected to generate aggregate Adjusted EBITDA of approximately $95 million over the average firm period of 3.1 years, implying a strongly accretive average Purchase Price / Annual Adjusted EBITDA multiple of approximately 4.0x. If all options are exercised, the vessels are expected to generate approximately $126 million of Adjusted EBITDA. With these additions, the Company’s fleet will comprise 50 vessels with a total capacity of 287,280 TEU.
The vessels are scheduled for phased delivery during the second and third quarters of 2021, at which time they will be renamed GSL Arcadia, GSL Dorothea, GSL Maria, GSL Melita, GSL MYNY, GSL Tegea and GSL Violetta. The Company expects to pay for the ships with approximately $40 million of cash on hand, with the balance provided by bank debt.
During the firm period of the contracted charters, the seven ships are expected to add approximately $29 million to annual Adjusted EBITDA, representing an increase of approximately 18% compared to Adjusted EBITDA for the 12 months to September 30, 2020, add approximately $19 million to annual net income, based on today’s LIBOR, representing an increase of approximately 40% compared to normalized net income for the 12 months to September 30, 2020, and add approximately $0.53 to annual earnings per share, an increase of approximately 40% compared to Adjusted earnings per share for the 12 months to September 30, 2020.
About Global Ship Lease
Global Ship Lease is a leading independent owner of containerships with a diversified fleet of mid-sized and smaller containerships. Incorporated in the Marshall Islands, Global Ship Lease commenced operations in December 2007 with a business of owning and chartering out containerships under fixed-rate charters to top tier container liner companies. On November 15, 2018, it completed a strategic combination with Poseidon Containers.
Excluding the acquisitions announced above, Global Ship Lease owns 43 containerships, ranging from 2,207 to 11,040 TEU, with a total capacity of 245,280 TEU and an average age, weighted by TEU capacity, of 13.7 years as at December 31, 2020. 25 ships are Post-Panamax, of which nine are fuel-efficient new-design wide-beam.
