Navios Maritime Partners L.P. (“Navios Partners”) (NYSE: NMM), an
international owner and operator of dry cargo and tanker vessels,
agreed to acquire a 36-vessel drybulk fleet for a gross purchase
price of $835.0 million, including the assumption of $441.6 million
of bank liabilities, bareboat obligations and finance leasing
obligations, subject to debt and working capital adjustments (the
“Transaction”), from Navios Maritime Holdings Inc. (“Navios
Holdings”) (NYSE:NM).
The 36-vessel drybulk fleet consists of 26 owned
vessels and 10 chartered-in vessels (all with purchase options)
with a total capacity of 3.9 million dwt and an average age of 9.6
years. Assuming Clarksons’ 1-YR TC rate (as of July 22, 2022) and
certain operating cost assumptions(1), the acquired vessels are
expected to generate approximately $164.0 million of estimated
EBITDA and $81.5 million of estimated free cash in 2023.
This acquisition builds upon Navios Partners’
strength in diversification and provides Navios Partners with:
- A young, known, en-bloc fleet of 36
vessels at an opportune time in the drybulk market
- Increased scale – post transaction
the drybulk and total fleet will increase by 67% and 24%,
respectively. NMM will have the third largest drybulk fleet, and
the second largest fleet, of US publicly traded companies (based on
number of vessels)
- Rebalanced segment exposure
- A migration path to a younger, more
carbon efficient fleet supported by opportunistically selling
older, less carbon efficient vessels
- Compelling financial returns (based
upon the aforementioned 2023 financial estimates)
- $835.0 million gross purchase
price
- $393.4 million estimated equity
- EBITDA multiple: 5.1x (Purchase
price/ estimated EBITDA)
- Unlevered yield: 20% (estimated
EBITDA/gross purchase price)
- Free cash return on equity: 21%
(estimated free cash/estimated equity)
Following the completion of the Transaction,
Navios Partners will own and operate a fleet comprised of 90
drybulk vessels, 49 containerships and 49 tanker vessels, including
22 newbuilding vessels to be delivered through the first quarter of
2025.
Approvals
The Transaction was negotiated and unanimously
approved by the Conflicts Committee of Navios Partners. The
Transaction was also unanimously approved by full board of
directors of Navios Partners.
Transaction Closing
The closing of the transaction is subject to
customary closing conditions, including consent of the existing
mortgage banks.
The first closing involving the transfer of 15
vessels will be completed on or about July 29, 2022, while the
second closing involving the remaining 21 vessels will be completed
in the third quarter of 2022.
Advisors
Jefferies LLC and S. Goldman Advisors LLC served
as financial advisors to the Conflicts Committee of Navios
Partners. Fried, Frank, Harris, Shriver & Jacobson LLP acted as
legal advisor.
Details of acquired fleet
Vessel |
Type |
Dwt |
Yard |
Year built |
Owned Vessels |
|
|
|
|
Navios Etoile |
Capesize |
179,234 |
Sungdong S.B. |
2010 |
Navios Happiness |
Capesize |
180,022 |
Daewoo S.B. |
2009 |
Navios Altamira |
Capesize |
179,165 |
Sungdong S.B. |
2011 |
Navios Bonheur |
Capesize |
179,259 |
Sungdong S.B. |
2010 |
Navios Corali |
Capesize |
181,249 |
Imabari SB |
2015 |
Navios Canary |
Capesize |
180,528 |
Tsuneishi Zosen |
2015 |
Navios Antares |
Capesize |
169,059 |
Sungdong S.B. |
2010 |
Navios Stellar |
Capesize |
169,001 |
Sungdong S.B. |
2009 |
Navios Lumen |
Capesize |
180,661 |
STX Shipbuilding |
2009 |
Navios Phoenix |
Capesize |
180,242 |
Imabari SB |
2009 |
Navios Herakles I |
Kamsarmax |
82,036 |
Nantong COSCO KHI |
2019 |
Navios Uranus |
Kamsarmax |
81,516 |
Tsuneishi Zosen |
2019 |
Navios Galaxy II |
Kamsarmax |
81,789 |
Tsuneishi Cebu |
2020 |
Navios Felicity I |
Kamsarmax |
81,946 |
Nantong COSCO KHI |
2020 |
Navios Magellan II |
Kamsarmax |
82,037 |
Nantong COSCO KHI |
2020 |
Rainbow N |
Panamax |
79,642 |
New Century S/Y |
2011 |
N Amalthia |
Panamax |
75,318 |
Universal S.B. |
2006 |
Navios Taurus |
Panamax |
76,596 |
Imabari SB |
2005 |
N Bonanza |
Panamax |
76,596 |
Imabari SB |
2006 |
Jupiter N |
Post-Panamax |
93,062 |
Taizhou Catic S.B. |
2011 |
Navios Galileo |
Panamax |
76,596 |
Imabari SB |
2006 |
Navios Sky |
Kamsarmax |
82,056 |
Sanoyas Shipbuilding |
2015 |
Navios Asteriks |
Panamax |
76,801 |
Sasebo H.I. |
2005 |
Navios Celestial |
Ultra Handymax |
58,063 |
Tsuneishi Zhoushan |
2009 |
Navios Ulysses |
Ultra Handymax |
55,728 |
Oshima S.B. Co. |
2007 |
Navios Vega |
Ultra Handymax |
58,792 |
Tsuneishi Cebu |
2009 |
Vessel |
Type |
Dwt |
Yard |
Year built |
Chartered-in Fleet with purchase options |
Navios Felix |
Capesize - scrubber fitted |
181,221 |
Imabari SB |
2016 |
Navios Obeliks |
Capesize - scrubber fitted |
181,415 |
Koyo Dock |
2012 |
Navios Amber |
Kamsarmax – scrubber fitted |
80,994 |
JMU Tsu. SY |
2015 |
Navios Coral |
Kamsarmax |
84,904 |
Imabari SB |
2016 |
Navios Citrine |
Kamsarmax |
81,626 |
Imabari SB |
2017 |
Navios Dolphin |
Kamsarmax |
81,630 |
Imabari SB |
2017 |
Navios Gemini(2) |
Kamsarmax |
81,704 |
Tsuneishi Cebu |
2018 |
Navios Horizon I (2) |
Kamsarmax |
81,692 |
Tsuneishi Cebu |
2019 |
Navios Venus |
Ultra Handymax |
61,339 |
Iwagi Zosen |
2015 |
Navios Lyra |
Handysize |
34,718 |
SPP Goseong SY |
2012 |
(1) Operating assumptions include among others:
Operating expenses and general and administrative expenses of the
acquired fleet in accordance with the existing rates of Navios
Partners, charter-in expenses, debt service cost and sale and
leaseback payments as per existing agreements of Navios Holdings to
be assumed by Navios Partners.
(2) Purchase option in the form of the right of
first refusal and profit share on sale of vessel.
Forward-Looking Statements
This press release contains and will contain
forward-looking statements (as defined in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended) concerning future
events, including completion of the Transaction and ability to
realize the projected advantages of the Transaction, TCE rates and
Navios Partners’ expected cash flow generation, future contracted
revenues, future distributions and its ability to make
distributions going forward, opportunities to reinvest cash
accretively in a fleet renewal program or otherwise, potential
capital gains, its ability to take advantage of dislocation in the
market and Navios Partners’ growth strategy and measures to
implement such strategy, including expected vessel acquisitions and
entering into further time charters and Navios Partners’ ability to
refinance its debt on attractive terms, or at all. Words such as
“may,” “expects,” “intends,” “plans,” “believes,” “anticipates,”
“hopes,” “estimates,” and variations of such words and similar
expressions are intended to identify forward-looking
statements.
These forward-looking statements are based on
the information available to, and the expectations and assumptions
deemed reasonable by Navios Partners at the time these statements
were made. Although Navios Partners believes that the expectations
reflected in such forward-looking statements are reasonable, no
assurance can be given that such expectations will prove to have
been correct. These statements involve risks and are based upon a
number of assumptions and estimates that are inherently subject to
significant uncertainties and contingencies, many of which are
beyond the control of Navios Partners. Actual results may differ
materially from those expressed or implied by such forward-looking
statements.
Factors that could cause actual results to
differ materially include, but are not limited to, risks relating
to: global and regional economic and political conditions including
global economic activity, demand for seaborne transportation of the
products we ship, the ability and willingness of charterers to
fulfill their obligations to us and prevailing charter rates, the
economic condition of the markets in which we operate, shipyards
performing scrubber installations, construction of newbuilding
vessels, drydocking and repairs, changing vessel crews and
availability of financing; potential disruption of shipping routes
due to accidents, wars, diseases, pandemics, political events,
piracy or acts by terrorists; uncertainty relating to global trade,
including prices of seaborne commodities and continuing issues
related to seaborne volume and ton miles, our continued ability to
enter into long-term time charters, our ability to maximize the use
of our vessels, expected demand in the dry and liquid cargo
shipping sectors in general and the demand for our drybulk,
containerships and tanker vessels in particular, fluctuations in
charter rates for drybulk, containerships and tanker vessels, the
aging of our fleet and resultant increases in operations costs, the
loss of any customer or charter or vessel, the financial condition
of our customers, changes in the availability and costs of funding
due to conditions in the bank market, capital markets and other
factors, increases in costs and expenses, including but not limited
to: crew, insurance, provisions, port expenses, lube oil, bunkers,
repairs, maintenance and general and administrative expenses, the
expected cost of, and our ability to comply with, governmental
regulations and maritime self-regulatory organization standards, as
well as standard regulations imposed by our charterers applicable
to our business, general domestic and international political
conditions, competitive factors in the market in which Navios
Partners operates; risks associated with operations outside the
United States; and other factors listed from time to time in Navios
Partners’ filings with the Securities and Exchange Commission,
including its Form 20-Fs and Form 6-Ks. Navios Partners expressly
disclaims any obligations or undertaking to release publicly any
updates or revisions to any forward-looking statements contained
herein to reflect any change in Navios Partners’ expectations with
respect thereto or any change in events, conditions or
circumstances on which any statement is based. Navios Partners
makes no prediction or statement about the performance of its
common units.
Contacts
Navios Maritime Partners L.P. +1 (212) 906 8645
Investors@navios-mlp.com
Nicolas BornozisCapital Link, Inc.+1 (212) 661
7566naviospartners@capitallink.com
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