Teekay LNG to buy second LNG Carrier from Awilco

By Finance

Teekay LNG Partners informed that it has decided to buy a 2nd 155,900 cubic meter (LNG) carrier newbuilding from Awilco LNG ASA (Awilco), company located in Norway owner and operator of LNG carriers.
The LNG ship is under construction in the moment (shipbuilder Daewoo Shipbuilding & Marine Engineering Co., Ltd. (DSME) of South Korea) and is planned to become operation by the end of the year.

Teekay LNG acquired the first ship for $205 million less a $50 million upfront prepayment of charter hire by Awilco including a deal to the daily bareboat charter rate. Awilco has to make the deal at a fixed price for the 2 ships and the firm charter period and option period. Each of the ships is expected to generate annual Distributable Cash Flow of more than $7 million.

The 2 companies have plans to finance the 2nd LNG carrier with a portion of its existing liquidity and
are planning a long-term debt.
There was an announcement:

"Further to our August 2013 announcement on the first Awilco LNG carrier newbuilding, the acquisition-leaseback of a second vessel from Awilco will provide Teekay LNG with additional near-term accretive cash flows,".
"These vessels will complement the Partnership’s strong portfolio of longer-term visible growth projects, including, the four LNG carrier newbuildings delivering in 2016 and the ten LPG newbuildings in our joint venture with Exmar, delivering between 2014 and 2017".

The board of directors decided the acquisition of the new ship and have to discuss minor details and to prepare the documentation.