Flex LNG plans to order two high - end MEGI LNGC newbuilds from DSME
Flex LNG Ltd. is contemplating to enter into a transaction for the acquisition of shipbuilding contracts for two high - end MEGI LNGC newbuilds at Daewoo Shipbuilding and Marine Engineering Co. Ltd. (“DSME”) with scheduled delivery in Q1 2018 currently held by affiliates of Geveran Trading Co. Ltd., the company’s largest shareholder.
The Transaction will give Flex LNG a uniform fleet of four LNG MEGI carriers with expected delivery in early 2018 with the most advanced propulsion and fuel efficiency technology compared to the existing LNG fleet.
Furthermore, the Transaction will consolidate all Geveran’s LNG assets and activities in Flex, which will be positioned to capitalize on the expected tightening in the LNG shipping market, and on the expected strong growth in the markets for LNG shipping and FSRUs.
Parts of the consideration payable for the newbuilds will be settled by Flex LNG through the issuance of 78 million new shares in Flex LNG to Geveran. The remaining part of the consideration will be settled by a seller’s credit structured as a revolving credit facility. Flex LNG will also assume responsibility for the remaining newbuilding instalments payable to DSME amounting to approximately USD 20.4 million. The RCF can be drawn and repaid partially or in full at any time at Flex LNG's discretion and matures three years after delivery of the vessels.