Financial firms Tite Street Capital and Crestline Investors have teamed up to buy their third container ship on charter to AP Moller-Maersk.
Tite Street, an investment advisor and asset manager based in the UK, said that the two companies have purchased the 2,550-teu feeder vessel Hammonia Berolina (built 2007), which had been owned by Germany’s Hammonia Reederei.
The price for the Chinese-built ship was not disclosed, but Tite Street chief investment officer Guido Lang told TradeWinds that the transaction was done in the mid-$20m range.
VesselsValue estimates that the vessel is worth $19m in an open-market deal, but the Hammonia Berolina’s price also includes a long-term charter attached to a big-name liner operator.
Tite Street said the ship has a long-term charter to Denmark’s Maersk.
“We are excited to be adding this high-quality vessel to the portfolio,” Lang said in a statement.
“The long-term charter to Maersk provides cash flow certainty during a period of heightened market volatility and while we may never see another year like that during Covid, we remain constructive on the long-term demand drivers for the container feeder fleet and look to acquire more vessels at adjusted asset prices this year.”
The deal marks the third transaction by the partnership between Tite Street and Texas-based Crestline, and it is their second in shipping.
Last year, they purchased the 2,490-teu Cindy (ex-ER Camilla, built 2004) and Elizabeth (ex ER Elena, built 2003) from Tufton Oceanic Assets.
Those ships also came with charters to Maersk and are under the technical management of Hammonia, which will continue to run the firm’s latest vessel.
For Tite Street and Crestline, the container ships are part of a strategy focused on downside protection provided by contracts with top-tier charterers but also an attractive entry price.
Andrey Panna, managing director at Crestline Europe, said the Hammonia Berlina deal brings a blue-chip, investment-grade counterparty.
“We remain attracted by the long-term contracted cash flows, ESG potential of the vessel, and future ability to re-charter the vessel at attractive rates thanks to the continuing consolidation of the liner industry and expected robust long-term growth in intra-regional container trade flows.”
Lang also pointed to the attractiveness of the repricing of container ships in recent months.
In April, for example, the Hammonia Berolina was worth more than $55m on an open market basis, according to vessels value.
Tite Street and Crestline still have funds to spend — an undisclosed amount in the “triple digit millions” — in their partnership, though some of that may go to real estate investments.
“We can do some more damage,” Lang told TradeWinds.
