Oslo-listed Hafnia has confirmed a blockbuster acquisition of 12 LR1 product tankers from Scorpio Tankers for an en bloc price of $414m that reflects rising tanker valuations despite the protracted trough market.
Hafnia's swoop on the entire LR1 fleet of New York-listed Scorpio was first revealed by TradeWinds on 19 January. Hafnia later acknowledged "advanced discussions" with the seller in a stock exchange filing.
The acquisition by BW Group-backed Hafnia bolsters the owner’s presence in the LR1 market, where it already owns or charters in 34 units.
At the same time it gives a significant cash liquidity boost to Monaco-headquartered Scorpio, and comes at a premium to the assumed value of the LR1 units, which had been pegged at between $30m and $32m by VesselsValue.
The tankers were all built in 2016, except for one 2015-built vessel, and all will be fitted with exhaust gas scrubbers at delivery, which will come between late February and mid-May.
Hafnia said in a filing on Thursday that it is in advanced discussions with China's ICBC Financial Leasing to finance the deal through a sale-and-leaseback structure with monthly purchase options and a purchase obligation at the end of a 10-year charter period.
Singapore-based Hafnia, led by chief executive Mikael Skov, said it had signed two new loan facilities to refinance an existing $266m loan, and also signed a term sheet to amend its current $216m facility.
“Through these transactions, Hafnia has secured up to $135m of extra liquidity through a combination of term loans and asset-based revolving credit facilities, allowing extra flexibility in the balance sheet,” the owner said.
Hafnia commercially operates a fleet of 198 vessels. Among them, 108 are owned or chartered-in, including 10 owned LR2s, 34 owned and chartered-in LR1s, 52 owned and chartered-in MRs and 12 owned handysizes.
Boost for Scorpio
As TradeWinds has reported, the deal also helps Scorpio, which has been the world's largest product tanker owner with a fleet around 130 units, answer questions about how it will allay liquidity concerns raised by some equity analysts ahead of a presumed market recovery later in 2022.
Analysts at Clarksons Platou Securities have said the presumed sale price reflects the strongest values for LR1s since 2016.
CTI deal done
Hafnia also said on Thursday it had completed a deal announced in November to add 32 fuel-efficient IMO II tankers through buying Chemical Tankers Inc (CTI).
CTI’s shareholders have received a total of 99m shares in Hafnia, or a 21.5% holding. CTI owner Oaktree Capital Management received 20.4% of this. BW Group remains the largest shareholder on 53%.
“In addition to the acquisition of the CTI fleet, we are fast-tracking our client-serving ability by adding an expert and experienced chemical commercial and operations team to our existing global network,” Hafnia said.
The trading of the chemical fleet will be overseen from its newly established Dubai office.
Skov said: “With the acquisition of Chemical Tankers Inc and Scorpio’s LR1 fleet, we have today added 44 vessels to our fleet, which now stands at 152 vessels. The 44 vessels are all compliant with the EEXI requirements entering into force in 2023.”
