Scorpio Bulkers' transition to a wind turbine installation vessel (WTIV) company has begun in earnest with the sale of its first vessel since the announced shift, with chief executive Emanuele Lauro promising it will be "one of many".
And indeed sources in the sale-and-purchase market indicate that more bulkers from the New York-listed owner's fleet of 48 are currently being circulated for sale in a process that is expected to bankroll at least the beginning of Scorpio's shift to wind.
The one unit confirmed by Scorpio in an announcement after the close of trading on Monday is the 82,000-dwt SBI Rock (built 2016), which is being sold to an unidentified third party at slightly over $18m.
Scorpio indicates the disposal is expected to generate liquidity of about $5m, and Lauro was not shy about linking the move to the wind venture.
“Last month we announced a new direction for Scorpio Bulkers — offshore wind as a sustainable business opportunity. This sale represents a step, one of the many deliberate steps we must take, in our transition," Lauro said.
Scorpio has estimated the project cost for the initial wind vessel at South Korea’s Daewoo Shipbuilding & Marine Engineering at between $265m and $290m. A letter of intent is expected to become a formal contract in the fourth quarter.
Delivery is set for 2023, with no “material” payments required until 2022. The New York-listed owner also holds three options.
Analysts have been split on whether Scorpio will finance the transition by selling all or most of its bulkers, or rather will need to conduct equity raises.
Monday's confirmed sale, and market reports of additional sales in the works, suggests that Scorpio's tack is likely the former.
A complete sell-off of the existing fleet likely could raise more than $300m in total liquidity, which would cover the first firm WTIV and the first option, market sources suggested.
