GasLog Acquires 2 BG Carriers
GasLog Ltd. completed the acquisition of two LNG carriers from Methane Services Limited, a subsidiary of BG Group plc (BRGXF), which was previously announced on December 22, 2014.
This transaction completes the third acquisition of ships from BG by GasLog in the last twelve months, with eight vessels acquired in total. The two ships subject to today’s announcement will be chartered back to MSL for nine and eleven year initial terms. MSL has options to extend the term of the time charters for each vessel for three or five years at its election. The two vessels, built in 2010, are the Methane Becki Anne and Methane Julia Louise and each have a cargo capacity of 170,000 cubic meters and have on-board reliquefaction plants, which enable the vessels to operate in a more fuel efficient manner at a greater range of speeds than would otherwise be achievable.
Due to the length of the charters, both vessels will be eligible for drop down into GasLog Partners LP (GLOP) (the “Partnership”), who has 3 years in which to exercise its options to purchase these ships from GasLog at fair market value. This will potentially increase future distributions to GasLog in respect of its limited partner and general partner interests in the Partnership.
Paul Wogan, CEO of GasLog, commented, “We believe this transaction reaffirms our commitment to BG and their appreciation of GasLog as a long-term service provider of LNG shipping. It is also an important step in realizing the GasLog 40:17 Vision1 that we announced at our capital markets day in December and we are continuing to develop further attractive opportunities to grow our fleet. These ships also add growth to the Gaslog Partners dropdown pipeline and should, we believe, enhance the sum of the parts valuation of GasLog.”
To complete the transaction, GasLog has drawn down on a $460 million credit facility led by DNB Bank, which comprises a $325 million secured credit facility and a $135 million subordinated two-year loan facility at rates in line with recent GasLog financings. Poten Capital Services (UK) advised GasLog on this transaction.
