Landbridge Group has refinanced two of its modern VLCCs in deals with Hong Kong-listed CSSC (Hong Kong) Shipping, regulatory filings show.
The Chinese VLCC owner has agreed to sell the 307,900-dwt Landbridge Glory and the 308,400-dwt Landbridge Horizon (both built 2019) to CSSC Shipping for $102m.
Landbridge has agreed to take the vessels back on charters for 84 and 108 months respectively for total charter fees of $172.4m including lease interest of $51.4m.
CSSC Shipping said the two crude oil tankers have an aggregate value of $201.6m according to valuation reports prepared by the qualified valuers appointed by both companies.
CSSC Shipping said it expected to take delivery of the two vessels, which were built by China’s Dalian Shipbuilding Industry Corp (DISC), by the end of August 2023.
Upon expiration of the charter periods, Landbridge has a purchase obligation on the vessels at an undisclosed consideration as agreed by the two companies.
Landbridge recently declared a purchase option for the 308,000-dwt Landbridge Wisdom (built 2020) from John Fredriksen’s US-listed sale-and-leaseback specialist SFL Corp.
SFL Corp paid $65m for the ship from Landbridge as a resale in 2020. The price of the option has not been revealed, but SFL Corp expects a $10m positive cash effect after the repayment of secured debt.
Landbridge was operating the vessel on a seven-year bareboat deal, with the first option to buy coming after three years. It would have been obliged to repurchase the tanker at the end of the term.
Established in 2012 and listed in 2019, CSSC Shipping is the leasing arm of state-owned China State Shipbuilding Corp and one of the world’s leading ship-leasing companies.
As of 31 December 2022, the company’s vessel portfolio numbered 158 vessels and had a total asset size exceeding HKD 40bn ($5.1bn), according to its latest annual report.
By asset value, LNG and LPG carriers make up 35.7% of the fleet, container ships 21%, tankers 19.6%, bulkers 13.8% and special tonnage 9.9%
Shandong-based Landbridge operates two other modern VLCCs both of which are leased from Norwegian and US investors.
Norwegian lessor Sole Shipping owns the 308,296-dwt Landbridge Prosperity (built 2016) via a sale and leaseback deal agreed in 2019.
In the same year, US alternative investment firm Varde Partners acquired Landbridge's 308,000-dwt Landbridge Prosperity (built 2016) in another leaseback arrangement.
Landbridge continues to operate the vessel under a bareboat charter before it must repurchase it at the conclusion of the charter period, the length of which has not been disclosed.
