Oman Shipping Company, wholly owned by the Sultanate of Oman, successfully raised $227mn to finance its purchase of 10 new medium range tankers, which are chartered to Shell Tankers Singapore for seven years.
Societe Generale acted as sole arranger and sole underwriter for the landmark transaction, which involved a combination of export credit agency (ECA) and commercial financing. Seven of the 10 vessels were covered by Koreas export credit agency, K-Sure.
Tarik Al-Junaidi, chief executive officer, Oman Shipping Company, said: We are very pleased with the successful close of this landmark transaction particularly in the current environment, a testimony to our current strategy and its robustness. Beyond the importance for OSC, this deal perfectly meets our companys objectives in terms of diversification of funding sources.
The funding covered the purchase of 10 50,000 dwt medium-range tankers, built by Hyundai Heavy Industries of South Korea. Societe Generale underwrote the whole transaction on the basis of an innovative structure: for seven of the vessels, a 12-year ECA facility combined with a Tied Commercial Loan. The remaining three vessels were financed under a seven-year mortgage loan.
Societe Generale, Crédit Agricole Corporate & Investment Bank, the Korea Development Bank and ABN Amro acted as mandated lead arrangers.
Venugopal Venkatesh, chief financial officer of Oman Shipping Company, said: At the start we set a number of objectives that had to be fulfilled, including finding one single bank able to assist us in raising financing for the acquisition of 10 vessels, raising long-term financing to move towards the asset lifespan, obtaining competitive pricing, diversifying our banking pool and increasing the OSC Groups visibility within the international banking market. Societe Generales commitment to meet all our requirements through an innovative model raised the profile of OSC and attracted liquidity to successfully close this transaction.