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Overview

CSSC enters into lease and buyback agreement worth USD 40 million with Star Bulk for the acquisition of the vessel Star Ariadne (HN 1360)

Commitments (Constant USD, 2023)$41,358,852
Commitment Year•2013Country 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
Jan 1, 2013
Last repayment (originally scheduled)
Dec 30, 2022

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 description

CSSC enters into lease and buyback agreement worth USD 40 million with Star Bulk for the acquisition of the vessel Star Ariadne (HN 1360)

Interest type•UnknownMaturity•10 years

Narrative

Full Description

Project narrative

In 2013, CSSC (Hong Kong) Shipping Co., Ltd. (CSSC) and Star Bulk Carriers (Star Bulk) entered into a sale and leaseback agreement worth USD 40 million for the acquisition of the Star Ariadne (HN 1360) 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 monthly at any point throughout the 10-year bareboat charter agreement. Upon the 10-year anniversary of the vessel’s delivery, Star Bulk is obligated to buyback the ship at a price of USD 12 million. The Star Ariadne was delivered to Star Bulk on March 28, 2017.

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 (in this case, CSSC) leases only the vessel (with no crew) to the charterer or lessee (in this case, Star Bulk).