Arne Blystad's Songa Container has taken full ownership of three sub-panamax containerships from Germany’s Reederei Lauterjung.
The Oslo-listed company exercised purchase options on the 2,564-teu City of Hongkong, City of Beijing and City of Shanghai (all built 2009).
Songa had an option to buy the vessels at $10.5m each as part of the original deal done in April 2018, but the option was not completed until December 2020.
The ships are estimated to be worth $15.6m each, according to VesselsValue. However, no additional cash payments have been made. Lauterjung had a loan agreement from Songa, and the purchase factors in the debt.
Earnings improve
Songa is positioned to take part in the market recovery in container shipping.
The company saw earnings improve towards the end of 2020, due to higher utilisation of its small and medium-sized boxship fleet and a fast-improving charter market.
It still posted a loss of $3.49m in the fourth quarter of 2020, up from $2.27m in the third quarter.
But revenues rose to $10.96m from $8.9m and Ebitda was again positive at $1.15m.
Songa will be left with 14 ships from 1,036 teu to 4,256 teu following the sale in early February of its largest containership.
The company is making a hefty profit on the sale of the 4,957-teu Songa Toscana (built 2013) for $42m to TS Lines of Taiwan.
The wide-beam panamax will be delivered to its new owner at the end of March.
Promising outlook
The sale and a promising outlook for time charter earnings leave Songa in a good position to refinance its 2023 bond earlier than expected, according to analysis by Fearnley Securities.
Songa has a number of vessels due for renewal in the coming months.
It is benefiting from an improvement in fleet utilisation as the last of its vessels completed its scrubber installation.
Twelve of its remaining 14 ships have been fitted with exhaust gas cleaning systems.
“The company remains well positioned through its direct market and pool exposure to take advantage of the revival in the container charter market,” Songa said.
