LONDON, December 15, 2021 / CNW / – Seaspan Corporation (“Seaspan”), a wholly owned subsidiary of Atlas Corp. (“Atlas”) (NYSE: ATCO), is proud to announce today the full details of one of its financing arrangements previously identified in the third quarterly results released on November 8, 2021. This innovative financing arrangement is a one-of-a-kind ship financing (the “Financing”), combining two existing asset financing structures to add long-term and attractively priced debt to Seaspan’s capital structure. The proceeds of the Funding totaling approximately $ 838 million will be used to finance eight previously announced new construction vessels, comprising four 12,000 TEU vessels and four 15,000 TEU vessels (the “Ships”). Unchanged from Atlas’s previously released third quarter results, financing has been secured for 60 of its 70 new vessels (which includes three previously announced vessel deliveries). Completion of the financing of the remaining 10 new construction vessels is still expected before the end of the year.
Highlights of transactions
This one-of-a-kind transaction combines two vessel finance structures, an Export Credit Agency (“ECA”) backed loan backed by China Export & Credit Insurance Corporation (“Sinosure”) and Assignment Agreements. lease under special Japanese leases, provide Seaspan with significant benefits, including:
- Long tenor – A 12-year post-delivery maturity with mortgage-style repayment, extends and diversifies Seaspan’s maturity profile
- At low price – significantly reduced prices compared to existing secured debt
- Fully funded construction cost – Provides partial financing of pre-delivery progress payments, totaling approximately 30% of the contract price, during construction, with the full value of the construction price financed on delivery
- Diversify funding sources – Combines Japanese equity (~ 25% of funding) with a syndicated loan backed by the ECA (~ 75% of funding)
Graham Talbot, Atlas and Seaspan CFO, commented: “This funding has been a significant time investment for our team, laying the groundwork over a period of several years, but the payoff is both long and remarkably long funding. low cost, from construction to 12 years after completion. This was made possible by Seaspan’s position as an industry leader and innovator in ship finance. Among other strategic advantages, through this transaction, we have further developed our relationship with Sinosure – an essential partner in China – and with Japanese equity investors. With this closing, we have secured financings for 60 of our 70 new vessels, solidifying our long-term liquidity and allowing continued quality growth. ”
Structure of transactions
Funding consists of two parts:
- Syndicated credit over 12 years backed by Sinosure, from China State-owned ECA (the “ECA Facility”) and
- Sale-leaseback arrangements under Japanese special lease agreements (“JOLCO”)
This transaction represents the first time that an ECA has provided export buyer credit insurance for a JOLCO transaction and involves complex structuring with various parties. The Funding will provide pre-delivery funding under the ECA Facility, which will become JOLCO funding on delivery, subject to certain conditions.
Shuigen casserole, Managing Director of Sinosure Jiangsu Branch, commented, “The successful closing of the financing represents that the cooperation between Seaspan and Sinosure has reached a new high. As the world’s leading independent container ship lessor, we are committed to long-term strategic cooperation and Chinese New Build Orders from Seaspan. We are also eager to explore new horizons on innovative and win-win project paradigms between us. ”
Hisanaga Tanimura, Founder and CEO of FPG, commented: “We are proud to be able to work with Seaspan again and are delighted to close this revolutionary structure. This transaction demonstrates our cutting-edge capabilities to organize and structure innovative partnership ship financing solutions with our clients. We look forward to continuing to develop our relationship with Seaspan.
Sam lippitt, Head of Export and Asset Finance for the Americas at HSBC, said, “We are delighted to have partnered with Seaspan to deliver a first place in the market: a JOLCO facility wrapped in Sinosure. Given the importance of China as a maritime exporter we see enormous potential to deploy this structure in support of Atlas in the future. “
In accordance with Seaspan policies, the financing documentation incorporates all requirements relating to the Poseidon Principles.
Advisors, lenders and export credit agency
Hongkong and Shanghai Banking Corporation Limited (“HSBC”) acted as ECA Agent, Global Coordinator and Senior Bookrunner; Citibank, NA, Deutsche Bank AG, HSBC, Société Générale, Bank of China Limited, BNP Paribas and ING Bank, NV, acted as mandated lead managers and bookkeepers; Bank of Communications acted as principal arranger and Standard Chartered Bank acted as arranger for the financing.
Sinosure provided export buyer credit insurance policies for the ECA JOLCO transaction, FPG-AIM acted as JOLCO arranger and FPG acted as underwriter of JOLCO shares.
Watson Farley williams acted as counsel for the lenders, in collaboration with june he. White & Case advised FPG and Squire Patton Boggs acted for Seaspan.
Atlas is a leading global asset management company, distinguished by its position as a leading owner and operator, focused on deploying capital to create sustainable shareholder value. Atlas brings together an experienced asset management team with in-depth operating and capital allocation experience. We target long-term risk-adjusted returns on high quality infrastructure assets in the marine, energy and other vertical infrastructure industries. Our two holding companies, Seaspan Corporation and APR Energy Ltd. are unique and industry-leading operating platforms in the global maritime and energy spaces, respectively. For more information visit atlascorporation.com.
Seaspan is a leading independent owner and operator of container ships. We charter our vessels primarily through long term, fixed rate charters from the largest container ships in the world. Seaspan’s operational fleet consists of 134 vessels with a total capacity of 1,156,800 TEUs. We also have 67 vessels under construction, bringing the total capacity of our operational fleet to 1,959,200 TEUs, on a fully delivered basis. For more information, visit seaspancorp.com.
Caution regarding forward-looking statements
This press release contains certain forward-looking statements (as that term is defined in Section 21E of the Securities Exchange Act of 1934, as amended) regarding future events. Statements which are predictive in nature, which depend on or refer to future events or conditions, or which include words such as “expects”, “anticipates”, “intends”, “plans”, ” believes “,” estimates “,” plans “,” forecasts “,” will “,” could “,” potential “,” should “, and similar expressions are forward-looking statements. These forward-looking statements do not reflect the current expectations of management only as of the date of this press release. Accordingly, you are cautioned not to rely on any forward-looking statements. Although such statements are based on what we believe to be reasonable assumptions based on the information available, they are subject to risks and uncertainties. These risks and uncertainties include, without limitation, the factors detailed from time to time in our periodic reports and documents filed with the SEC, including Atlas’s annual report on Form 20- F for exercise closed December 31, 2020, filed with the SEC on March 19, 2021. We expressly disclaim any obligation to update or revise any of these forward-looking statements, whether as a result of future events, new information, a change in our views or expectations, or otherwise. We do not make any predictions or statements about the performance of any of our securities.
SOURCE Atlas Corp.
For more information: Investors and Media Inquiries: Robert Weiner, Atlas Corp., Tel. + 1-904-345-4939, Email: [email protected], E-mail: [email protected]