Western Bulk Chartering has bought and sold an ultramax bulk carrier in a deal that will generate a profit of just under $5m.
The Oslo-listed operator said it has exercised a purchase option on the 63,500-dwt Western Oslo (built 2019) to buy the ship from Nisshin Shipping on undisclosed terms.
Soon after, it said it sold the vessel to unnamed buyers and expects to realise $4.5m in net profit that will be booked in the third quarter.
Orjan Svanevik, interim CEO of Western Bulk, said the transaction underscores the flexibility of the company’s business model.
“The transaction supports our asset-light business model and dividend distribution policy,” he added.
The ultramax was built at China’s Nantong Xiangyu shipyard to the Dolphin 63.5 design and has been fitted with a ballast water treatment system.
VesselsValue estimates the Western Oslo’s current market value at $30.93m.
Rival platform Maritime Strategies International values the unit at between $25.8m to $30.7m.
Jorgen Veie-Rosvoll, Western Bulk’s head of period tonnage, said exercising the purchase option was the most profitable move for the vessel, given what the company sees as a mismatch in asset prices and period rates.
“We have strong confidence in the short-term market, but the second-hand prices for modern eco ultramaxes have reached a level where they do not correlate with the long-term TC [time-charter] market,” he said.
“The second-hand market for five-year-old eco ultramax vessels was approximately $3.5m to $4.5m lower last year compared to this year.”
Values for five-year-old ultramaxes are currently at five-year highs, according to Clarksons estimates, while period rates are somewhere around the median of what has been seen since 2019.
Clarksons currently estimates one-year supramax rates at $15,000 per day and three-year period rates at $12,750 per day, based on a 58,000-dwt vessel.
Western Bulk said it will continue to evaluate other purchase options in its trading book.
Svanevik will be succeeded as CEO on 1 September by Torbjorn Gjervik, who is stepping up from his current position as head of the North Atlantic region. This follows the resignation of Hans Aasnes earlier this year.
Speaking to TradeWinds in June, Gjervik said Western Bulk will continue its traditional focus on the supramax segment and will keep building its presence with panamaxes, which has been “profitable” so far.
“We do not believe this is the right entry point for becoming shipowners, but we stay curious about gaining access to more tonnage through other means and cooperation,” he commented.
