The red-hot container ship space produced yet another landmark deal on Thursday. Navios Maritime Partners unveiled the sale of two 16-year-old vessels at what is probably a record price for ships of that age.
The US-listed Greek owner agreed this month to divest the 8,204-teu sisterships Navios Utmost and Navios Unite (both built 2006) to an unrelated party for $220m in total.
The sale is expected to be completed during the second half of 2022, the company said on the occasion of its latest earnings release.
The buyer remained undisclosed but it will not be a surprise if it is one of the major liner companies.
Flush with cash from a boom that sent charter rates soaring, firms such as Mediterranean Shipping Co, CMA CGM and Wan Hai Lines bought more than 200 container ships last year from independent owners on the secondhand scene, fundamentally changing the structure of the market.
Navios Partners operated the Navios Utmost and the Navios Unite under a sale-and-leaseback structure with the Bank of Communications for a period of up to five years, at the end of which Navios had an obligation to purchase the vessels.
The Navios Utmost is currently earning $21,656 per day on a charter expiring in September. Navios Unite's ongoing charter fetches $27,840 per day through to April 2024.
Proceeds from the sale are expected to boost Navios Partners’ results after what was already a stellar year.
The owner and operator of nearly 150 bulkers, container ships and tankers reported net income of $516.2m for the full year, compared with a $68.5m loss in 2020.
Adjusting for one-off accounting items, net income in 2021 was a still sizeable $364.1m, from $9.9m in profits in the previous year.
The one-off accounting items were mostly related to a series of complicated internal transactions within the Navios group of companies that turned Navios Partners into the behemoth it is today.
“In 2021, we reimagined the public shipping company,” Frangou said in Thursday’s press release.
“While we do not expect this to work perfectly, we believe the diversity will sufficiently reduce volatility and create flexibility in our operational and financial decision-making process as we charter, purchase and sell vessels and finance our activities.”
Apart from selling container ships, Navios has been busy ordering them. In November, it booked two firm and two optional 5,300-teu newbuildings for $62.8m in total. The deal brought its newbuilding investment to $1bn for 18 ships scheduled for delivery through to 2024.
This expansion drive is underpinned by healthy boxship markets that saw the company secure long-term charters recently for 11 container ships on the water or under construction. Navios Partners expects the deals to generate about $670m in contracted revenue.
The company announced a $0.05-per-share payout to unitholders for the fourth quarter, during which it reported soaring net income of $117.5m, up from a $50.2m loss a year earlier.
Like other companies, Navios Partners has jumped on the green ship finance bandwagon. In December, it entered into a “sustainability-linked” $72.7m credit facility with a commercial bank to roll over older debt.
