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Tuesday, 14 November 23
CAPITAL PRODUCT PARTNERS L.P. ANNOUNCES TRANSFORMATIVE TRANSACTION INCLUDING THE ACQUISITION OF 11 NEWBUILD LNG CARRIERS FOR $3.1 BILLION
Capital Product Partners L.P. announced that it has entered into an umbrella agreement (the “Umbrella Agreement”) with Capital Maritime & Trading Corp. (“Capital Maritime”) and Capital GP L.L.C. (the “General Partner”) providing for the acquisition of the following 11 newbuild LNG carriers (“LNG/C”) from Capital Maritime for a total acquisition price of $3,130.0 million:
The vessels will be purchased through the acquisition of 100% of the equity interests in the applicable vessel-owning company. The LNG/C Amore Mio I has been delivered in October 2023 and we expect to acquire its vessel-owning company on or about the closing date of the Umbrella Agreement (the “Closing Date”). The acquisition of this vessel was financed through a $196.3 million sale and leaseback transaction between the vessel-owning company and CMB Financial Leasing Co., Ltd (the “Amore Mio I Debt”). For the vessel-owning companies of the LNG/Cs Axios II, Assos, Apostolos Aktoras, Archimidis and Agamemnon (the “Initial Vessels”), we expect to pay on the Closing Date a 10% deposit on their respective purchase prices. We will acquire each Initial Vessel after the applicable vessel’s construction completion and delivery from the shipbuilder. The vessel-owning companies of the LNG/Cs Alcaios I, Antaios I, Athlos and Archon (the “Remaining Vessels”) will be acquired on the Closing Date and we will take over their obligations under the respective shipbuilding contracts with Hyundai. We expect that the total amount due on or about the Closing Date to Capital Maritime will be $454.2 million, reflecting the acquisition of Amore Mio I – net of the Amore Mio I Debt, which is expected to be carried over – the 10% deposit for the Initial Vessels and the amount due for acquiring the Remaining Vessels. On delivery of each Initial Vessel, we will pay the balance of the purchase price for such vessel to Capital Maritime, which will total $1,569.6 million for all Initial Vessels. For the Remaining Vessels, we expect to pay an additional total amount of $909.9 million to Hyundai in pre-delivery and delivery installments. The Closing Date is expected to occur by year end 2023 upon the closing of the rights offering described below.
$500.0 million Rights Offering and $220.0 million Sellers’ Credit
In addition to commercial debt, and in order to finance a portion of the purchase price for the vessels and pursuant to the Umbrella Agreement, (i) Capital Maritime has agreed to issue an unsecured seller’s credit to us in an amount of up to $220.0 million at a fixed rate of 7.5%, repayable on June 30, 2027 and (ii) we will conduct a rights offering to finance $500.0 million of the purchase price.
The rights offering is expected to commence on November 27, 2023 (the “Launch Date”). We will distribute to holders of our common units of record on November 24, 2023 (“the “Record Date”) rights to purchase newly issued common units at a price per common unit equal to the greater of (x) $14.25 and (y) 95% of the volume-weighted average price of the common units trading on the Nasdaq Global Select Market for the period from November 15, 2023 through and including the last trading day immediately prior to the Record Date. The subscription price per common unit in the offering will not be greater than $14.50. The rights will not be transferable. The rights offering will be made only by means of a prospectus supplement and accompanying prospectus. We intend to disseminate the rights certificates and a copy of the prospectus supplement and accompanying prospectus for the offering to Record Date unitholders shortly following the Record Date. In connection with the rights offering, and pursuant to the Umbrella Agreement, we will enter into a standby purchase agreement with Capital Maritime, pursuant to which Capital Maritime shall, subject to customary conditions, purchase 100% of any common units in respect of rights that remain unexercised after completion of the issue at the same offering price per common unit.
Other terms of the Transaction
Following the closing of the Umbrella Agreement, we intend to explore the disposal of our container vessels and abstain from acquiring additional container vessels. Pursuant to the Umbrella Agreement, we also agreed to change our name to “Capital New Energy Carriers L.P.” This name change is expected to become effective by December 31, 2023. Further, we, Capital Maritime and the General Partner have agreed to, in good faith negotiate and jointly work with tax and other advisors to agree terms for the conversion from a Marshall Islands limited partnership to a corporation with customary corporate governance provisions within six months of the closing of the Umbrella Agreement.
In connection with the change of our business focus to concentrate on the LNG/C market, Capital Maritime agreed to grant to us, beginning on the Closing Date rights of first refusal over (i) transfers of LNG/C vessels owned by Capital Maritime to third parties, opportunities to order newbuild LNG/C vessels of which Capital Maritime becomes aware, and employment opportunities for LNG/C vessels of which Capital Maritime becomes aware, in each case, for a period ending on the tenth anniversary of the Closing Date, (ii) transfers to third parties of two certain liquid CO2 carriers and two certain ammonia carriers recently ordered by Capital Maritime (the “New Energy Vessels”) for a period ending when Capital Maritime and its affiliates no longer beneficially own at least 25% of the issued and outstanding common units and (iii) if we acquire a New Energy Vessel from Capital Maritime, employment opportunities for such New Energy Vessel of which Capital Maritime becomes aware, for a period ending when Capital Maritime and its affiliates no longer beneficially own at least 25% of the issued and outstanding common units.
The transaction was negotiated and unanimously approved by the conflicts committee of the Board of Directors (“Committee”) and was also unanimously approved by the full Board of Directors. Evercore Group L.L.C. served as financial advisor and Fried, Frank, Harris, Shriver & Jacobson LLP served as legal advisors to the Committee. Sullivan & Cromwell LLP served as legal advisors to Capital Maritime.
Management Commentary
Mr. Jerry Kalogiratos, Chief Executive Officer of our General Partner, commented:
“We are very pleased to announce this transformative transaction for the Partnership, which we expect to usher Capital Product Partners L.P. to a new chapter in its life as a public listed entity. Upon completion of the 11 LNG/C fleet acquisition, we expect CPLP to transform, into one of the largest US listed shipping companies in terms of enterprise value and the largest owner of two stroke, latest generation LNG carriers compared to the current fleet of its US listed peers. The commitment to change the name of the Partnership to ‘Capital New Energy Carriers L.P.’ and to gradually divest our container vessels, reflects our renewed business focus on LNG and energy transition shipping. We are well positioned to take advantage of the strong fundamentals of the LNG industry with six open LNG/Cs delivering between 2026-2027 and rights of first refusal on a unique fleet of LCO2 and ammonia carriers. We believe that this transaction, together with our stated intention to convert the Partnership into a corporation and to review over time our capital allocation policy, should attract additional investor interest and allow our equity valuation to move closer to our peers.”
“Importantly, the acquisition of the 11 LNG carriers is expected to be transformative across all financial and qualitative metrics for the Partnership, as we expect our contracted revenues to increase by 87% to $3.1 billion, our revenue weighted charter duration to 7.2 years as of the Closing Date and the average age of our LNG fleet to decrease to 3.2 years by the time all LNGCs have been delivered in 2027.”
“Finally, I am pleased to see our largest unitholder and sponsor, Capital Maritime, fully backstop at no additional cost and at a 9.6% premium to the last closing price a $500.0 million rights offering and offer an attractively priced $220.0 million seller’s credit to partly finance this transaction, while giving a right of first refusal on all LNG business and its New Energy newbuilding vessels to CPLP. We believe that the rights offering with the Capital Maritime backstop will allow for all our unitholders to participate without execution risk in the transition of CPLP to an LNG and energy transition focused corporation, which we hope to become a bell weather for the industry.”
Source: Capital Product Partners L.P.
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Friday, 01 December 23
COAL MINERS GROUP EXPECTS INDONESIA’S 2023 COAL OUTPUT TO SURPASS TARGET - REUTERS
The Indonesian Coal Mining Association (ICMA) expects the country’s 2023 coal output to surpass the official target of 695 million metric ton ...
Friday, 24 November 23
COAL IMPORTS TO INDIA IN OCTOBER 2023 REACHED HIGHEST LEVELS IN NEARLY A YEAR AND A HALF - VESSELSVALUE, VESON NAUTICAL
In October, coal imports to India reached 13.8 mt in October 2023, according to Oceanbolt, a Veson Nautical solution, the highest level since May 2 ...
Friday, 24 November 23
COAL SHIPMENTS TO ADVANCED ECONOMIES DOWN 17% SO FAR IN 2023 - BIMCO
In the first ten months of 2023, coal shipments to advanced economies fell by 17% y/y, as demand for electricity declined and the share of electric ...
Friday, 24 November 23
INTELLIGENT COAL MINES CONTRIBUTE TO IMPROVING SAFETY STANDARDS - CHINA DAILY
Mechanization, automation and intelligent upgrades have contributed to improved safety in coal mines, though the level of development of intelligen ...
Friday, 24 November 23
WHY AUSTRALIA'S COAL MINES ARE GETTING BIGGER - IEEFA
Australia’s largest coal mines are getting larger. Mines in New South Wales (NSW) are ramping up production following the state’s recov ...
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- Carbofer General Trading SA - India
- Maheswari Brothers Coal Limited - India
- AsiaOL BioFuels Corp., Philippines
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Posco Energy - South Korea
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- Chettinad Cement Corporation Ltd - India
- Rio Tinto Coal - Australia
- PowerSource Philippines DevCo
- Krishnapatnam Port Company Ltd. - India
- Oldendorff Carriers - Singapore
- Binh Thuan Hamico - Vietnam
- Sarangani Energy Corporation, Philippines
- Petron Corporation, Philippines
- ASAPP Information Group - India
- Sree Jayajothi Cements Limited - India
- Global Green Power PLC Corporation, Philippines
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Coalindo Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Eastern Energy - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
- Borneo Indobara - Indonesia
- Goldman Sachs - Singapore
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- TeaM Sual Corporation - Philippines
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Kideco Jaya Agung - Indonesia
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhatia International Limited - India
- SMC Global Power, Philippines
- Chamber of Mines of South Africa
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Grasim Industreis Ltd - India
- Semirara Mining Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Africa Commodities Group - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Romanian Commodities Exchange
- South Luzon Thermal Energy Corporation
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- Neyveli Lignite Corporation Ltd, - India
- Tamil Nadu electricity Board
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- Lanco Infratech Ltd - India
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Bukit Baiduri Energy - Indonesia
- Energy Link Ltd, New Zealand
- Mjunction Services Limited - India
- Planning Commission, India
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Bulk Trading Sa - Switzerland
- Energy Development Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- Madhucon Powers Ltd - India
- Independent Power Producers Association of India
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- India Bulls Power Limited - India
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Kaltim Prima Coal - Indonesia
- Altura Mining Limited, Indonesia
- Singapore Mercantile Exchange
- Interocean Group of Companies - India
- Rashtriya Ispat Nigam Limited - India
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- Indika Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Trasteel International SA, Italy
- Indian Energy Exchange, India
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- GMR Energy Limited - India
- Karaikal Port Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Jindal Steel & Power Ltd - India
- GAC Shipping (India) Pvt Ltd
- OPG Power Generation Pvt Ltd - India
- Attock Cement Pakistan Limited
- Siam City Cement PLC, Thailand
- The Treasury - Australian Government
- Siam City Cement - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- MS Steel International - UAE
- Bharathi Cement Corporation - India
- Pendopo Energi Batubara - Indonesia
- Gujarat Sidhee Cement - India
- Coal and Oil Company - UAE
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Deloitte Consulting - India
- Australian Coal Association
- White Energy Company Limited
- Maharashtra Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Marubeni Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Eastern Coal Council - USA
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Ministry of Transport, Egypt
- The University of Queensland
- Anglo American - United Kingdom
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Leighton Contractors Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Banpu Public Company Limited - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Baramulti Group, Indonesia
- PTC India Limited - India
- Merrill Lynch Commodities Europe
- Global Coal Blending Company Limited - Australia
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Ministry of Finance - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Aditya Birla Group - India
- Standard Chartered Bank - UAE
- Orica Australia Pty. Ltd.
- Karbindo Abesyapradhi - Indoneisa
- PNOC Exploration Corporation - Philippines
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- IEA Clean Coal Centre - UK
- Aboitiz Power Corporation - Philippines
- Mercuria Energy - Indonesia
- Star Paper Mills Limited - India
- Indogreen Group - Indonesia
- Globalindo Alam Lestari - Indonesia
- Malabar Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- SN Aboitiz Power Inc, Philippines
- Georgia Ports Authority, United States
- Cement Manufacturers Association - India
- Parliament of New Zealand
- Alfred C Toepfer International GmbH - Germany
- Salva Resources Pvt Ltd - India
- SMG Consultants - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
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