Reference is made to the stock exchange notice dated 4 April 2019 by Okeanis Eco Tankers Corp. (OAX:OET) (“OET” or the “Company”) announcing the granting of an option to OET by entities controlled by OET’s sponsor and chairman, Mr. Ioannis Alafouzos (the “Sponsor”), to acquire two ECO design, scrubber-fitted 158,000 DWT Suezmax tankers under construction at Hyundai Samho Heavy Industries delivering in August 2020 (the “Option Vessels”) at the Sponsor’s cost of USD 64.5 million per vessel. As Suezmax values have risen and newbuilding delivery timelines extended into 2021 in the period since its granting, the option is presently well in-the-money and accretive to NAV. In addition, with the recent dramatic firming of the tanker spot and time charter markets and the availability of low cost, high LTV financing (discussed below), OET is highly confident that exercise of the option will require no new issuance of equity. Accordingly, OET is today pleased to announce that its Board of Directors has resolved to exercise the option.
The Company has received firm indications for low cost, high LTV pre- and post-delivery financing from multiple large and reputable financial institutions. Additionally, in connection with the option exercise, OET and Sponsor have agreed to extend the maturity of the USD 15 million revolving credit facility (which remains undrawn at the date hereof) from Glafki Marine Corp. (“Glafki”, an affiliate of the Sponsor) by six months, to December 2020. Lastly, OET and Sponsor have agreed that repayment of ten percent of the Option Vessels’ total contract price settled between the Sponsor and the shipyard in April 2019 may be deferred, at OET’s sole discretion, to any date before the end of September 2021 with no interest, cost or penalty accruing on any outstanding amount during the period. The Board of Directors believes that the increased financial flexibility resulting from these measures should obviate the need for an equity issuance even under unexpectedly negative market scenarios.
OET possesses among the youngest, highest quality, scrubber-fitted tanker fleets assembled specifically to benefit from the strength in freight rates and asset prices expected to result from the firming tanker market fundamentals and IMO 2020 regulations. In line with its strategy and consistent with its Discount Control Mechanism, the Company intends to capitalize on such strength by returning resulting cash from operations and well-timed asset sales to shareholders in the most tax-efficient manner possible.
John Papaioannou, CFO
+30 210 4804099
This information is subject to disclosure requirements pursuant to the Continuing Obligations and Section 5-12 of the Norwegian Securities Trading Act.
Okeanis Eco Tankers is a pure play eco and scrubber-fitted tanker company that owns and operates a fleet of seventeen modern, high-specification crude oil and products tankers in the VLCC, Suezmax and Aframax/LR2 segments.
Forward Looking Statements
Matters discussed in this release may contain certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates, sometimes identified by the words “believes”, “expects”, “intends”, “plans”, “estimates”, “anticipates” and similar expressions. The forward-looking statements contained in this release, including assumptions, opinions and views of the Company or cited from third-party sources, are solely opinions and forecasts that are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. The Company does not provide any assurance that that the assumptions underlying such forward-looking statements are free from errors, nor does the Company accept any responsibility for the future accuracy of the opinions expressed in the presentation or the actual occurrence of the forecasted developments. No obligations are assumed to update any forward-looking statements or to conform to these forward-looking statements to actual results.