Dubai-based Gulf Navigation Holding has tapped the Chinese leasing market to refinance five of its product tankers under what it described as new and preferential terms.
The company, which is listed on the Dubai Financial Market, is one of a growing number of Middle Eastern shipowners to tap Chinese lease financing as an alternative to traditional bank loans.
Gulf Navigation said in a regulatory filing on Wednesday that it had concluded lease financing deals with Jiangsu Financial Leasing for five of its 46,000-dwt MR-type product/chemical tankers.
The terms of the agreement extend to five years, the company said, without disclosing any further financial details.
Ali Abouda, Gulf Navigation’s chief financial officer, said the lease financing deal agreement “will establish a strong and prosperous relationship with our new partner”.
Abouda added that the company was “grateful” for Jiangsu Financial Leasing’s “distinguished support and belief in the company’s ability to grow and expand its operations in the coming years”.
“We consider that our selection of outstanding partners has played a fundamental role in the company’s success and ability to continue moving forward on its path of corrective approach,” the CFO said.
“Our signing of this agreement is a testament to the company’s financial strength and its continuous ability and determination to strengthen its position as a regional leader in the transport of petrochemicals.
“The company will be able to use the new financing facilities to improve debt conditions, reduce the total cost of borrowing and avoid refinancing risks. This agreement will also assist in exploring opportunities that will enable the company to expand the scope of its integrated shipping services locally and regionally”.
Gulf Navigation lists five MR2 product/chemical tankers as being part of its fleet which also includes a livestock carrier and several offshore vessels.
The MR2s were all built between 2008 and 2010.
While the vessels involved in the deal with Jiangsu Financial Leasing were not identified, market sources suggested they are Gulf Navigation's four Hyundai Mipo-built MR2s, which are equipped with 22 tanks.
Jiangsu Financial Leasing is listed on the Shanghai Stock Exchange and is the first financial leasing company listed in A-share market in China.
