Danaos Corp is getting a boost from Seaspan Corp's $1bn loan programme, analysts say.
Seaspan late Wednesday afternoon said it set up a "first of its kind" financing to consolidate 12 credit facilities into an $800m term loan facility and $200m revolver.
The Bing Chen-led owner plans to put $328m into the loans, secured by 36 ships, in five years at Libor plus 2.25%, according to SEC documents. The rest will be placed in a new facility.
Danaos' shares have shot up 23% over the past two days to $13.74 since Seaspan's announcement because it sets an example for Danaos, Jefferies analyst Randy Giveans said.
"People are saying if Seaspan can do it, why can't Danaos do it?" Giveans, Danaos' only analyst, told TradeWinds.
Danaos holds $1.49bn of long-term debt against a $206m market cap, while Seaspan has $2.8bn up against a $2.2bn market cap.
Giveans also pointed out that Danaos' latest share price is a return to where it was trading at about a month ago, adjusting for a 1-for-14 reverse stock split on 2 May.
'Not a game changer'
The Seaspan loan programme does allow the company to move ships in and out of its fleet but it is not necessarily a move unprecedented in shipping, he said.
"I don't think it is a game changer but it gives some flexibility on what they do with their ships," he said.
It's more of a positioning for future projects."
Seaspan in April announced a partnership with Cosco Shipping Energy focused on the development of LNG vessels.
