Indonesian tanker owner Buana Lintas Lautan (BULL) has unveiled plans to tap the bond markets for up to $400m in fresh capital.
The bonds are expected to have a maturity date of five years, with the proceeds going towards early debt repayment and for working capital purposes.
The Jakarta-listed company is expected to seek approval for the bond issuance at an extraordinary General Meeting of Shareholders on 11 October 2021.
This will be the second time in three years that BULL has attempted a bond issue after scrapping plans to issue $200m in 2019.
“As the proceeds of the bonds will be primarily used to repay most of BULLs outstanding loans, the bonds will further strengthen the company’s financials as it will not only diversify the company’s funding and extend its duration, but also provide a stable and long-term funding while at the same time increasing its net cash flow by more than $80m annually,” the shipowner said.
Company president Henry Jusuf added: “The unique features and strengths of the bonds is that they will further enhance the company’s ability to execute its proven strategy of conservative growth based on at least 80%-90% revenues from contracts with string clients such as Pertamina and Shell, and low-leverage assets with high Ebitda margins of more than 60%.”
In June, the company reported a record net profit for 2020 of $37.8m, up 78.3% year-on-year, on the back of its huge fleet growth that year.
The company took delivery of a total of 13 tankers in 2020 increasing the number of vessels in its fleet from 25 to 38 vessels and increasing its fleet capacity by 50% to 2.1m dwt.
BULL said prospects for the remainder of 2021 were “positive” due to the rapid and accelerating pace of vaccinations, which have reduced the Covid-19 infection rates rapidly.
“China, the European Union, the UK and the US, which comprise half of all the world’s oil demand, have on average have vaccinated more than 75% of their citizens,” the shipowner said.
BULL’s fleet of 38 vessels, which is made up of tankers and gas carriers covering all size segments, is currently worth around $335m according to VesselsValue.
