SFL Corporation Acquires Two Containerships and One VLAC for USD 365 Million
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SFL Corporation Ltd. announced that it has agreed to acquire two 8,800 TEU containerships, with delivery scheduled for 2027, and a 93,000 cubic meter dual-fuel very large ammonia carrier (VLAC), with delivery expected in 2028. The aggregate cost of the acquisition is around USD 365 million, and the company also signed long-term charter contracts for all three vessels.
Containership Charters
The two containerships have been fixed on time charter contracts to a leading, publicly unidentified shipping company for a minimum of eight years from delivery. The contracts may be extended by up to four additional years and include purchase options after years 8, 10 and 12, along with a profit share mechanism.
VLAC Contract
The VLAC has been time chartered to a global commodity trading leader for a minimum of five years from delivery, with an option to extend for up to two additional years. The charterer will also have the option to arrange the sale of the vessel during the last two years of the firm period, subject to a profit sharing arrangement with SFL.
Impact on Contract Backlog
According to SFL, these new charters will add a minimum of USD 333 million to its fixed-rate charter backlog, a figure that could grow further if the extension options are exercised. SFL Management AS CEO Ole B. Hjertaker noted that with the acquisitions and new contracts announced so far this year, the company has added more than USD 1.6 billion to its fixed-rate charter backlog.
Other Recent Transactions
The deal adds to other recent moves by SFL, controlled by John Fredriksen: in early October it had ordered two more 93,000 cubic meter VLACs for about USD 216 million, with long-term charters valued at a minimum of USD 162 million with an investment-grade European oil major. In addition, the company agreed to sell four LR2 tankers and three suezmax tankers to trading house Trafigura for about USD 275 million in net cash proceeds, and in September it renewed the charters of six 15,400 TEU containerships with Hapag-Lloyd for seven years, adding USD 750 million in additional contracted revenue.
