Box Ships enters agreements to acquire two container vessels from OOCL
Shipping company Box Ships Inc. (TEU) said Tuesday that it has entered into agreements with subsidiaries of Orient Overseas Container Line Ltd., or OOCL, to acquire two acquire two 5,344 TEU post-Panamax container vessels, the 1995-build OOCL Hong Kong and the 1996-build OOCL China, Nasdaq reports.
The purchase price per vessel is $31.2 million, inclusive of fees. Delivery of the vessels are expected to take place before July 14.
Both vessels will be chartered to OOCL for thirty-six months plus or minus thirty days at a net daily rate of $26,465 and is expected to generate about $57.0 million of net revenues for the agreed period.
The company issued $40.0 million of 9.75 percent Series B Cumulative Redeemable Perpetual Preferred Shares to the Chairman, President and Chief Executive Officer, of the company, Michael Bodouroglou, in order to finance the acquisition.
Box Ships will fund the remaining purchase price by drawing down a $25.0 million senior secured credit facility pursuant to a firm commitment letter it has received from a major European bank.
The credit facility has a tenor of three years with a balloon of $10.0 million, and will accrue interest at a rate of LIBOR plus 3.75 percent.
The company also commenced a public offering of 700,000 Series B preferred shares, together with warrants to purchase 700,000 of its common shares at anytime between July 1 and June 30 at a purchase price of $7.74 per share.
The net proceeds of the offering are expected to be used to redeem a portion of the Series B preferred shares and related warrants sold to Bodouroglou.