Ship Finance International Limited (NYSE: SFL) (Ship Finance) announces that it has agreed to acquire a fleet of 15 feeder size container vessels, ranging from 1,100 TEU to 4,400 TEU, in combination with long-term bareboat charters to a leading container line.

Ship Finance International Ltd announces acquisition of 15 vintage vessels and sale of SFL Avon
Caption: Container Ship SFL Avon - Image courtesy of Ya Ray Yang

The purchase price is confidential, but close to recycling value of the vessels. The charter term will be seven years from delivery, with subsequent purchase obligations by the charterer. Delivery of the vessels is expected in April and their aggregate EBITDA contribution is estimated to be approximately $20 million per year.

Concurrently, the Company has agreed to sell the 1,700 TEU container vessel SFL Avon to an unrelated third party. This vessel has been operated in the short term charter market and net sales proceeds will be approximately $12.5 million. Delivery to the new owner is expected in April 2018, and we expect a minor book gain in connection with the sale.

Ole B. Hjertaker, CEO of Ship Finance Management AS, said in a comment: "We are very pleased to continue building our relationship with one of the world's leading container lines. This transaction offers an attractive cash flow from a strong counterpart and with limited downside risk. The SFL Avon was our only container vessel operated in the short term charter market, and in light of the recent upswing in values in the sector we have decided to sell the vessel as we evaluate various growth prospects. We are seeing increasing opportunities to deploy capital in 2018 and we remain focused on growing our fleet and charter backlog."

Source: SFL