CMB Leasing enters into sale and leaseback agreement valued at USD 38.5 million with Capital Product Partners L.P. for the acquisition of the M/V Aristomenis (linked to project #92124)

On January 20, 2020, CMB Financial Leasing Co., Ltd. (CMB Leasing) and Capital Product Partners L.P., a Marshall Islands-incorporated shipping conglomerate, entered into a sale and leaseback agreement valued at USD 38.5 million for the acquisition of Capital Product Partners' M/V Aristomenis. The lease agreement has a duration of five years, with an interest rate of LIBOR plus 2.55%. The agreement includes a purchase option to acquire the vessel upon expiration of the lease for USD 22.5 million and requires a payment of USD 7.5 million to CMB Leasing if the option is not exercised. There are also additional purchase options beginning with the first anniversary of the agreement. The full amount of USD 38.5 million was drawn on January 23, 2020. An identical agreement was signed for the M/V Aristomenis' sister ship, M/V Athos on January 20, 2020 (captured in project #92124).

Additional details

1. Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products. 2. AidData has calculated LIBOR as being 1.839%, based on the 6-month LIBOR in January 2020 (https://www.global-rates.com/en/interest-rates/libor/american-dollar/2020.aspx). Hence, the interest rate has been calculated as (1.839% + 2.55% = 4.389%).

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