The Newbuild Facility covers eight vessels, which will be delivered between 2016 and 2019. Seven of the eight vessels have long-term contracts of between 7 and 10 years and will be chartered to a subsidiary of BG Group plc following delivery.
The key highlights of the $1.3 billion Newbuild Facility, the largest financing in GasLog’s history, are as follows:
- Tenor of up to 12 years with an amortisation profile of 15 years from vessel delivery
- Attractive weighted-average margin
- High levels of interest from GasLog’s existing bank group and a number of new institutions (final commitments more than two times oversubscribed)
- Backed by the Export Import Bank of Korea (“KEXIM”) and the Korea Trade Insurance Corporation (“K-Sure”), who are either directly lending or providing cover for over 60% of the facility
- All seven vessels with contracts are eligible for future dropdown into GasLog Partners LP
Terms of the Newbuild Facility are in line with or better than GasLog’s existing facilities, demonstrating the banks’ strong appetite to lend to leading counterparties in the LNG industry with modern assets and high quality, long-term contracts, which provide significant visibility on future revenue and cashflow.
The eight vessels covered by the Newbuild Facility are as follows:
|SHI Hull 2072||174,000||TFDE||Q1 2016||10 years||BG Group|
|SHI Hull 2073||174,000||TFDE||Q2 2016||10 years||BG Group|
|SHI Hull 2102||174,000||TFDE||Q3 2016||7 years||BG Group|
|SHI Hull 2103||174,000||TFDE||Q4 2016||7 years||BG Group|
|SHI Hull 2130||174,000||X-DF||Q1 2018||9 years||BG Group|
|SHI Hull 2131||174,000||X-DF||Q1 2019||9 years 10m||BG Group|
|HHI Hull 2800||174,000||X-DF||Q1 2018||9 years 4m||BG Group|
|HHI Hull 2801||174,000||X-DF||Q1 2018||–||–|
GasLog’s outstanding capital expenditure for its eight-vessel newbuild programme is approximately $1.5 billion, with $1.3 billion of debt provided by the Newbuild Facility, representing all planned financing for the vessels. As the vessels deliver over the next four years it is intended that the outstanding balance will be funded by cash on GasLog’s balance sheet and operational cash flow.
Simon Crowe, Chief Financial Officer of GasLog Ltd. commented, “I am delighted we have completed GasLog’s largest financing to date, which was executed during a period of volatility in the global energy sector. This Newbuild Facility further strengthens GasLog’s robust financial platform, which is backed by almost $4 billion of contracted revenue. The strong relationships we have with our lenders and our stated strategy of long-term contracted business with reputable customers were imperative in securing attractive tenor and rates on this facility.
We have been very pleased to see both new and existing lenders in this facility, demonstrating the appetite from a range of international banks to lend to companies with modern assets with solid contracts at good rates. The support of KEXIM and K-Sure further adds to the attractiveness of this facility.”
Citibank N.A (“Citi”) and Nordea Bank AB (“Nordea”) acted as Global Co-Coordinators, Bookrunners and Mandated Lead Arrangers (“MLAs”). Citi has also acted as ECA Agent and ECA Coordinator and Nordea as Agent and Security Agent. The other lead arrangers in the lending syndicate are Bank of America National Association, BNP Paribas, Credit Agricole Corporate and Investment Bank, Credit Suisse AG, HSBC Bank plc, ING Bank N.V., KEB Hana Bank, KfW IPEX-Bank GmbH, National Australia Bank Limited, Oversea-Chinese Banking Corporation Limited, Societe Generale and The Korea Development Bank.