FSRU player Hoegh LNG has agreed to purchase the 2013-built LNG carrier Golar Seal from CoolCo for about 184.3 million.
CoolCo, formed by Idan Ofer’s Eastern Pacific Shipping and Tor Olav Troim’s Golar LNG, said in a statement that it expects the transaction to close on redelivery of the 160,000-cbm vessel from its current charter in late March.
This means that Hoegh LNG shall assume all costs associated with the vessel’s forthcoming dry-dock, increasing the effective economic value to CoolCo to about $190 million, it said.
Last year, CoolCo purchased this vessel and seven more ships from its shareholder Golar LNG.
According to CoolCo’s website, EPS now has a 49.9 percent stake in the company, Golar LNG owns 8.3 percent of the firm, and public investors hold the rest.
“Through the sale of the Golar Seal, the earliest vessel in our fleet to be built, we are demonstrating our disciplined approach to locking in shareholder value,” Richard Tyrrell, CEO of CoolCo, said.
“The valuation highlights the re-pricing of the LNG carrier market and strategic value of such LNG infrastructure assets. A 2.5x cash-on-cash return in little more than 12 months since CoolCo’s formation shows the considerable upside in our fleet,” he said.
Moreover, Tyrrell said the transaction releases about $94 million in cash that “will be available in the event the company decides to exercise its option agreement on two highly sought-after Hyundai Samho vessels, now scheduled for delivery ahead of contract in the second half of 2024.”
Hoegh LNG said in a separate statement it expects to take delivery of the LNG carrier Golar Seal in late March or April 2023 and subsequently employ the vessel in the carrier market on a term time charter.
Also, the firm said the purchase price is in line with current market level for similar vessels.
Erik Nyheim, CEO of Hoegh LNG, welcomed this investment, which underpins the company’s growth ambitions.
“The vessel will be an excellent addition to our fleet, and provide flexibility to pursue FSRU conversion opportunities,” he said.
Hoegh LNG has ten FSRUs as well as two LNG carriers in its fleet.
The firm recently signed a new deal with a group of banks to refinance its two FSRUs, both employed on long-term contracts in Germany.