Flex LNG Ltd. has announced the successful closing and completion of the sale-and-charterback (SCB) transaction with Hyundai Glovis Co Ltd. which was announced in April.
Under the transaction, the vessels Flex Endeavour and Flex Enterprise have been sold for a gross consideration of US$420 million, with a net consideration of US$300 million to the company adjusted for a non-amortising and non-interest bearing seller's credit of US$120 million in total. Both vessels will be chartered back on a time-charter basis to subsidiaries of Flex LNG for a period of 10 years, and the company will have options to acquire the vessels during the term of the time-charters.
Flex Endeavour and Flex Enterprise were, together with Flex Ranger, financed under a US$315 million term loan facility due in 2023. In addition to the Glovis SCB, the company has also closed and refinanced the remaining tranche for Flex Ranger, and the total outstanding of US$294 million under the US$315 million facility has been prepaid in full. The Flex Ranger has been refinanced with a new US$100 million bank loan divided into a US$50 million term loan and a US$50 million revolving facility. The new loan has an improved margin of 2.25% p.a., compared to 2.85% p.a. under the US$315 million facility. The tenor is 5 years and the age adjusted repayment profile is 19 years. Other terms and conditions are similar to the US$250 million financing for Flex Constellation and Flex Courageous announced in February.
Øystein Kalleklev, CEO of Flex LNG Management AS, commented:
“We are very satisfied with the successful closing of the Glovis SCB according to plan, and highly appreciate the close and good working relationship with Hyundai Glovis throughout this process. In connection with the Glovis SCB we also decided to improve our capital structure by refinancing Flex Ranger at better terms and conditions. The US$50 million revolving facility under the new loan will also enable us to optimise the excess cash resulting from the Glovis SCB, which released in excess of US$100 million to us. The two transactions improve our financial flexibility to return earnings to our shareholders when market conditions improve.”
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/29072019/flex-lng-agrees-lng-carrier-transaction-with-hyundai-glovis/