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Overview

CSSC enters into sale and leaseback agreement worth $30 million USD with Star Bulk for the acquisition of the vessel Star Eleni (Linked to Record ID#92116, #92119)

Commitments (Constant USD, 2023)$31,923,791
Commitment Year•2017Country of Activity•Marshall IslandsDirect Recipient Country of Incorporation•Marshall IslandsSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 13, 2017
Last repayment
Dec 11, 2027

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Funding agencies

State-owned companies

  • CSSC (Hong Kong) Shipping Co., Ltd.

Receiving agencies

Private Sector

  • Star Bulk Carriers Corp.

Loan desecription

CSSC enters into sale and leaseback agreement worth $30 million USD with Star Bulk for the acquisition of the vessel Star Eleni

Interest type•UnknownMaturity•10 years

Narrative

Full Description

Project narrative

On December 13, 2017, CSSC (Hong Kong) Shipping Co., Ltd. (CSSC) and Star Bulk Carriers (Star Bulk) entered into a sale and leaseback agreement worth $30 million USD for the acquisition of the Star Eleni shipping vessel, owned by Star Bulk. The vessel was leased back to Star Bulk for a period of 10 years in a bareboat charter agreement, with an unknown variable interest rate. The agreement allows for purchase options that can be exercised by Star Bulk on a monthly basis at any point throughout the 10 year bareboat charter agreement. Star Bulk took delivery of the Star Eleni on January 3, 2018. An identical sale and leaseback agreement was signed for the Star Eleni's sister ship, the Star Leo on May 2, 2018 (captured via Record ID#92219). In September 2018, Star Bulk exercised its purchase options on both the Star Eleni and Star Leo, buying out the ships for $28.7 million USD and $29.4 million USD, respectively. The funding for exercising the options was provided by China Merchants Bank Leasing (captured via Record ID#92116).

Staff comments

1. Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products. 2. A ‘bareboat charter’ is a charter in which the owner of the boat leases only the vessel (with no crew) to the charterer or lessee (in this case, Star Bulk). 3. Star Bulk Carriers was incorporated in 2006 and is based in Marousi, Greece.