TOP Ships Inc. Announces Newbuilding Vessel With Time Charter to Oil Major
November 24 2017 - 5:00PM
TOP Ships Inc. (Nasdaq:TOPS), an international ship-owning company
(the “Company”), announced today that it has acquired all of the
outstanding shares of PCH77 Shipping Company Limited, a Marshall
Islands company that owns a new building contract for M/T Eco
California, a high specification 50,000 dwt Medium Range (“MR”)
product/chemical tanker under construction at Hyundai Mipo Dockyard
Co., Ltd. in Korea from an entity affiliated with the Company’s
Chairman and Chief Executive Officer, Mr. Evangelos Pistiolis. The
Company paid $3.6 million for the outstanding shares and the vessel
is scheduled for delivery during January 2019.
Upon its delivery, the vessel will be employed
under a time charter with an oil major for a firm duration of two
years with a charterer’s option to extend for one additional year.
The rate of the charter consists of a fixed amount per day plus a
50% profit share for earned rates over the fixed amount. The
Company expects a total gross revenue backlog associated with this
time charter of $15.1 million, including the optional period but
excluding any upside from the profit share arrangement.
The abovementioned transaction was approved by a
special committee of the Company's board of directors, or the
Transaction Committee, of which all of the directors were
independent. In the course of its deliberations, the Transaction
Committee hired and obtained a fairness opinion from an independent
financial advisor.
Following the acquisition of the abovementioned
vessel, the Company’s charter coverage is as follows:
Year |
|
Operating fleet |
|
Operating fleet includingvessels partly ownedthrough joint
ventures |
2017 |
|
100% |
|
100% |
2018 |
|
94% |
|
95% |
2019 |
|
72% |
|
77% |
2020 |
|
40% |
|
51% |
2021 |
|
14% |
|
19% |
The above charter coverage percentages are
calculated as the ratio of number of days vessels are expected to
be hired pursuant to the fixed period of existing time charters
divided by number of days vessels are available for chartering
during the respective calendar years assuming no off-hire days.
The capital commitments from this new
acquisition, assuming leverage levels similar to the average
initial leverage levels of the existing fleet, are estimated at
about $13 million.
Evangelos Pistiolis, President and CEO of the
Company, stated: “As of today, the total gross revenue backlog for
the fixed charter period of all of the Company’s operating fleet,
excluding any upside from profit share arrangements, stands at
about $110 million and when adding the 50% of our joint venture
vessels, it increases to about $126 million, with cash flow
visibility reaching into 2021. Our business strategy remains
focused on growing our fleet.”
About TOP Ships Inc.
TOP Ships Inc. is an international ship-owning
company.
For more information about TOP Ships Inc., visit
its website: www.topships.org.
Forward-Looking Statements
Matters discussed in this press release may
constitute forward-looking statements. The Private Securities
Litigation Reform Act of 1995 provides safe harbor protections for
forward-looking statements in order to encourage companies to
provide prospective information about their business.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements, which are other than
statements of historical facts.
The Company desires to take advantage of the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995 and is including this cautionary statement in
connection with this safe harbor legislation. The words “believe,”
“anticipate,” “intends,” “estimate,” “forecast,” “project,” “plan,”
“potential,” “may,” “should,” “expect," “pending” and similar
expressions identify forward-looking statements. The
forward-looking statements in this press release are based upon
various assumptions, many of which are based, in turn, upon further
assumptions, including without limitation, our management's
examination of historical operating trends, data contained in our
records and other data available from third parties. Although we
believe that these assumptions were reasonable when made, because
these assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible
to predict and are beyond our control, we cannot assure you that we
will achieve or accomplish these expectations, beliefs or
projections.
Contacts:
Alexandros TsirikosChief Financial OfficerTOP Ships Inc.1,
Vassilissis Sofias Str. &Meg. Alexandrou Str.151 24, Maroussi,
GreeceTel: +30 210 812 8180Email: atsirikos@topships.org
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