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Teekay Tankers announces asset sales

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Christian Fernsby ▼ | January 29, 2020
Teekay Tankers has reached an agreement with Hili Ventures to sell a portion of its oil and gas ship to ship transfer support services business, which also provides gas terminal management and gas consulting services, for approximately $26 million.
Teekay Tankers
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The sale is expected to close late in the first quarter of 2020 or early in the second quarter of 2020.

Topics: Teekay Tankers

Teekay Tankers will retain its entire Full-Service Lightering business that operates in the U.S. Gulf, which provides ship to ship oil transfers for both U.S. crude imports and exports.

In addition, the Company will continue to operate oil ship-to-ship transfer support services in North America and the Caribbean, a business that has synergies with its core Full-Service Lightering business.

Teekay Tankers has agreed to sell three 2003 uilt Suezmax tankers in separate transactions for combined sale proceeds of approximately $57 million.

The first vessel was delivered to the buyer in December 2019 and the remaining two vessels are expected to be delivered during February 2020.

The proceeds from the vessel sales are expected to be used to reduce debt, including approximately $30 million of debt directly secured by these three vessels.

Teekay Tankers has closed a new five year, $533 million revolving credit facility to refinance 31 vessels.

The size of the new debt facility was reduced since announcing the term sheet signing in November 2019 as a result of excluding five vessels from the new facility, including the three vessel sales noted above and a potential for further opportunistic vessel sales.

The proceeds from the new debt facility will be used to repay approximately $455 million of the Company’s existing debt.

The new debt facility has substantially similar terms and extends balloon maturities from 2020/2021 until the end of 2024.

Including the agreed asset sales and the new debt facility, the Company’s liquidity is expected to increase by approximately $73 million.