Belgian tanker owner Euronav has acquired two tankers through joint ventures in a bid to boost its winter spot exposure in strong markets.
The New York-listed owner said it had formed two 50:50 companies with affiliates of Ridgebury Tankers and clients of Tufton Oceanic.
Each venture has acquired one suezmax for a combined $40.6m.
Euronav told TradeWinds it was not naming the vessels, but they had been acquired from two different owners not connected to the partners.
The partnership deal may potentially be something it will repeat, as the company is always looking to be opportunistic, it added.
Euronav is also providing financing for the joint ventures on commercially attractive terms, it said.
One vessel is being delivered with immediate effect and the other will be handed over before the end of the month
Euronav will commercially manage both.
"This opportunistic undertaking reflects the strength of Euronav’s balance sheet and flexibility in responding quickly to the current constructive crude tanker market freight conditions," Euronav said.
"These two on-the-water vessels are ideally positioned to take advantage of what Euronav and our partners believe is the early stages of a sustained period of elevated freight rates in the large tanker market."
Attractive deal
Fearnley Securities said the deal is attractive and estimates the fair value of each ship at $23m.
"Assuming 50% debt financed, 5% interest and five-year amortisation profile, these vessels would have a cash break-even of $17,000 per day, and on our FY20 $40,000 per day forecast, generate 83% return on equity," it added.
It said that in isolation, this is a small deal for Euronav, which operates 25 suezmaxes.
But it added: "On any metric this deal can be rationalised."
