Containership giant Seaspan Corp has taken another step towards an investment-grade credit rating with an upgrade from Kroll Bond Rating Agency.

The expanding shipowner, controlled by New York-listed Atlas Corp, now has a corporate rating of BB+ from the agency, up from BB previously.

The senior secured rating was lifted from BBB- to BBB, the lowest rung on the investment grade ladder.

This indicates Seaspan is resistant to credit losses except in "stressed environments".

The agency said the rating outlook is stable.

The assessment reflects Seaspan's "innovative" portfolio financing programme which closed in 2019 and has since grown to $2.5bn as the newbuilding orderbook has grown, Kroll said.

The agency noted "improvements in Seaspan's business risk management, including a more diversified customer base, improved funding source diversification through multiple unsecured debt issuances, and increased unencumbered assets which improves financial flexibility."

In July, Fitch Ratings kicked off coverage of Seaspan with a BB rating.

Continuing journey

Graham Talbot, Seaspan's chief financial officer, said the upgrade was another step on Seaspan's continuing journey towards an investment-grade credit rating.

"As our team continues to progress towards a simpler, more efficient and more flexible balance sheet, we expect further recognition from rating agencies and our global base of investors," he added.

Fearnley Securities, which has a "buy" rating on the Atlas shares, acted as co-manager of Seaspan's recent $750m sustainability-linked bond.

The Norwegian investment bank said vessel charter rates continues to climb across the sector, both for short-term contracts of up to a year and longer deals of more than two years.

"Some degree of price stabilisation can however be found for the smaller classes, where gains have started to slow," Fearnleys said.

The investment bank believes a peak to rates seems unlikely amid a shortage of ships. But analysts Peder Nicolai Jarlsby, Erik Gabriel Hovi and Ulrik Mannhart argued that some stabilisation bodes well for the short to medium term "in terms of volumes and flow through the supply chains".