Performance Shipping has secured the loan backing the acquisition of its first product tanker.
The Athens-based, New York-listed tanker owner said on Monday that it had secured an $18.3m, five-year loan from Alpha Bank — half the $36.5m purchase price of the 105,300-dwt LR2 Alpine Amalia (built 2010).
“The addition of Alpha Bank AE as a new lender to our company demonstrates confidence in Performance Shipping, with a five-year term loan facility which reduces our cost of debt and extends our maturities into late 2027,” chief executive Andreas Michalopoulos said in a statement.
“We expect to draw down the Facility in November to consummate the acquisition of our seventh vessel, the M/T P. Aliki.
“The timely addition of this ballast water treatment system (BWTS) and scrubber-fitted LR2 tanker to our fleet, in conjunction with its competitive financing arrangements, positions us advantageously in the refined petroleum product tanker sector, with spot and time charter rates for LR2 tankers currently averaging in excess of $40,000 per day.”
Performance announced the deal to buy the Alpine Amalia, which will be renamed the P Aliki, in August.
The ship was owned by Glencore and is expected to be delivered to Performance Shipping in November.
The company will use the loan to pay for as much as half the ship. It previously said it intended to use cash on hand and funds raised through share sales for the other half.
The loan deal comes with an interest rate of the secure overnight financing rate plus 2.6% per year.
It is repayable over 20 consecutive $500,000 quarterly payments plus an $8.25m balloon payment in the 20th quarter.
