Scorpio Tankers Inc. announces newbuilding agreements for seven VLCCs
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Scorpio Tankers Inc. announced that it has entered into agreements for the construction of seven Very Large Crude Carriers ('VLCCs') and entered into an agreement with an unaffiliated third party to issue shares in exchange for the transfer of ownership to the Company of four MR product tankers currently under construction in South Korea, the company said in its press release.
The Company has reached agreements with Daewoo Shipbuilding and Marine Engineering Co., Ltd and Hyundai Samho Heavy Industries for the construction of seven VLCCs for an aggregate price of approximately $652.5 million. One vessel is scheduled for delivery in the third quarter of 2015, two in the fourth quarter of 2015, two in the first quarter of 2016 and two in the fourth quarter of 2016.
The Company has reached an agreement with an unaffiliated third party to issue shares in exchange for the transfer of ownership to the Company of four MR product tankers currently under construction in South Korea. The purchase price of the four vessels, in aggregate, is approximately $154 million. One vessel is expected to be delivered in the third quarter of 2014 and the remaining three are expected to be delivered in the first quarter of 2015. These vessels are similar to the Company's newbuildings that are also under construction at the same shipyard.
Approximately 20% of the total purchase price for the vessels will consist of newly issued common shares of the Company having a valuation based on the fair market value of the shares at the time of issuance. The new common shares will be issued to affiliates of York Capital and the remainder of the purchase price will be paid to the shipyard from cash-on-hand and bank debt.
The transactions remain subject to customary closing conditions and final documentation.
About Scorpio Tankers Inc.
Scorpio Tankers Inc. is a provider of marine transportation of petroleum products worldwide. Scorpio Tankers Inc. currently owns 19 tankers (one LR2 tanker, four LR1 tankers, one Handymax tanker, 12 MR tankers, and one post-Panamax tanker) with an average age of 4.1 years, time charters-in 29 product tankers (eight LR2, four LR1, eight MR and nine Handymax tankers), and has contracted for 65 newbuilding vessels (32 MR, 12 LR2, and 14 Handymax ice class-1A product tankers and seven VLCCs), 45 are expected to be delivered to the Company in 2014, 16 in 2015 and four in 2016. The Company also owns 30% of Dorian LPG Ltd.