Narrative
Full Description
Project narrative
Between October 2014 and June 2020, Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB), China COSCO Shipping Corporation Limited (COSCO), and Aviation Industry Corporation of China (AVIC) collectively signed at least seven (7) sale-and-leaseback agreements with Golar LNG for oceangoing vessels. The transactions were conducted through a variety of subsidiaries and branch offices, principally ICBC Financial Leasing (ICBCFL), ICBC International Leasing Finance Company (ICBCIL), CCB Financial Leasing (CCBFL), and Cosco Shipping Development (CSDC). All vessels were owned by Chinese state-owned special purpose vehicles (SPVs) acting as variable interest entities (VIEs). For some transactions, AidData is currently reporting the minimum known rates (see staff comment #1 as applicable). In addition, Golar LNG is assumed to have been the guarantor for all agreements until January 26, 2022, other than Golar Ice and Golar Kelvin, which were continuously guaranteed by the company. In October 2014, ICBC entered into a dual-tranche secured financing agreement for $184.4 million with Golar LNG to finance a ten (10) year sale-and-leaseback agreement on the Golar Glacier vessel, owned by the ICBC SPV Hai Jiao 1401 Ltd. The senior non-recourse loan facility (#99032), financed by ICBC through its branch office in Brussels, was sized at $153 million, had a 10-year maturity, and had an interest rate of at least 2.11%. The facility was repayable in semi-annual installments and stipulated a balloon payment upon maturity. The short-term junior loan facility (#99033), financed by ICBCIL, was sized at $31.8 million, an unknown but short-term maturity date, and an interest rate of 6%. Then, in January 2015, ICBC entered into a dual-tranche secured financing agreement for $182.6 million with Golar LNG to finance a ten (10) year sale-and-leaseback agreement on the Golar Snow vessel, owned by the ICBC SPV Hai Jiao 1402 Ltd. The senior non-recourse loan facility (#99034), financed by ICBC through its branch office in Brussels, was sized at $160 million, had a 10-year maturity, and had an interest rate of at least 2.11%. The facility was repayable in semi-annual installments and stipulated a balloon payment upon maturity. The short-term junior loan facility (#99035), financed by ICBCIL, was sized at $22.6 million, an unknown but short-term maturity date, and an interest rate of 6%. Also in January 2015, ICBC entered into a $182.5 million junior loan facility with Golar LNG to finance a ten (10) year sale-and-leaseback agreement on the Golar Kelvin vessel, owned by the ICBC SPV Hai Jiao 1405 Ltd (#99036). The facility, financed by ICBCIL, had an unknown maturity date and an interest rate of 6%. Then, in February 2015, ICBC entered into a $172 million junior loan facility with Golar LNG to finance a ten (10) year sale-and-leaseback agreement on the Golar Ice vessel, owned by the ICBC SPV Hai Jiao 1406 (#99037). The facility, financed by the Malta-incorporated ICBC subsidiary Skysea Malta Capital Company Ltd., had an unknown maturity date and an interest rate of 3%. Then, in March 2016, CCB Financial Leasing (CCBFL), China Construction Bank's (CCB) wholly-owned financial leasing subsidiary, signed a $162.4 million loan facility with Golar LNG to refinance an existing $1.125 billion ECA-backed loan facility on the Golar Seal LNG carrier vessel (#99042). The lease had a maturity of nine (9) years and an interest rate of at least 2.46%. After settlement of set-up fees and prepayment of 3-months principal, Golar LNG received $48.7 million in cash liquidity. Then, in March 2017, COSCO Shipping Energy Transportation Co. (CSDC), COSCO's wholly-owned financial leasing subsidiary, signed a $101 million loan facility with Golar LNG to finance a ten (10) year sale-and-leaseback agreement on the Golar Crystal vessel, owned by the COSCO SPV Oriental Fleet LNG 01 Ltd (#99046). The loan had a 10-year maturity and an interest rate of an unknown margin plus contemporary LIBOR. Then, in June 2020, AVIC signed a $110 million loan facility with Golar LNG to finance a seven (7) year sale-and-leaseback agreement on the Golar Bear vessel, owned by the AVIC SPV Cool Bear Shipping Ltd (#99067). The loan had a 3-year maturity and an interest rate of at least 3%. On January 26, 2022, Golar LNG entered into a vessel share purchase agreement (SPA) with Cool Company (CoolCo), which was formed from Golar's FSRU and shipping assets. Golar LNG maintained a 31% stake, with 31% being sold to the public and a 38% majority stake sold to EPS Ventures Ltd., a subsidiary of Quantum Pacific Shipping Services Ptd. Ltd. Then, in Q1 2022, CoolCo refinanced all debt on the Golar Glacier, Golar Snow, Golar Seal, Golar Crystal, and Golar Bear vessels through a $570 million senior secured sustainability term loan facility from a lending syndicate, the members of which are currently unknown. However, the ICBCFL-issued debt on the Golar Kelvin and Golar Ice vessels was maintained and assumed by CoolCo, including a continuing guarantee from Golar LNG.