Bank of China contributes $79 million to $542 million syndicated loan tranche for the acquisition of ten 15,000 TEU vessels

On December 23, 2021, a special purpose vehicle (SPV) that is wholly owned by Seaspan Corporation (a company that is incorporated under the laws of the Republic of the Marshall Islands) signed a $1.08 billion syndicated buyer’s credit agreement with Citi, Bank of America, Bank of China, Société Générale, Deutsche Bank, HSBC, Korea Development Bank (KDB). Citi acted as the global coordinator and lead bookrunner. The borrowing terms of the loan are unknown. However, it is known that the loan is backed by a credit insurance policy from Korea Trade Insurance Corporation (K-Sure) and the Export-Import Bank of Korea (KEXIM). The loan consists of three tranches: a $542.6 million K-sure-backed tranche, a $267 million Kexim-backed tranche, and a $267.8 million Kexim direct loan. Bank of China reportedly contributed $53 million to the $542 million, K-Sure-covered syndicated loan tranche with a 12 year maturity and $26 million to the $266 million KEXIM-covered syndicated loan tranche with a 12 year maturity. The purpose of the project is to facilitate the acquisition of ten 15,000 TEU LNG dual-fuel newbuild vessels. The 10 vessels are LNG dual fueled containerships and meet the EU Taxonomy criteria for energy efficiency (EEDI). The vessels will run on LNG, with pathway towards bio-LNG. Samsung Heavy Industries is the contractor responsible for the construction of the vessels.

Additional details

1. The transaction has a JOLCO structure. A JOLCO is an operating lease for the purposes of accounting and tax, which gives the lessee an option to purchase the aircraft at the end of the lease, or at some point during the lease period, at the purchase price determined at the commencement of the lease.

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