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Danaos acquires 3 containerships through new joint venture

Danaos Corporation, one of the world's largest independent owners of containerships, announced the acquisition of three vessels through a newly-formed joint venture, capitalizing on depressed asset prices in the resale market.

The vessels were acquired by Gemini Shipholdings Corporation, a newly-formed entity ("Gemini") beneficially owned by Danaos and its largest stockholder. Danaos' initial 49% ownership interest in Gemini was acquired through an investment of $7.35 million.

The vessels acquired are:

  • The 6,422 TEU NYK Lodestar, built in 2001 at Samsung Heavy Industries, which has already commenced a 2 year time charter with NYK.
  • The 5,610 TEU Suez Canal, built in 2002 at Hyundai Heavy Industries, which is on a 7 year bareboat charter to Gemini with a purchase obligation at the end of the charter.
  • The 5,544 TEU Genoa built in 2002 at Imabari Shipbuilding, which is on a 7 year bareboat charter to Gemini with a purchase obligation at the end of the charter.

In each case, the vessels have been acquired at attractive discounts to their market values. The NYK Lodestar has been chartered for a 2 year term at an above market rate. The average length of Danaos' current vessel charters is 7.4 years with contracted revenue of $3.3 billion. Danaos anticipates charter agreements for the Suez Canal and the Genoawill be entered into in the near future.

Dr. John Coustas, Chairman and CEO of Danaos commented:

"These acquisitions were made at a discount to the vessels' present market value and demonstrate our ability to source accretive acquisitions through our strong relationships in the shipping and lending communities."

"We are pleased to announce this new venture, which will allow Danaos to resume its growth strategy as weakness in the containership market presents compelling value. It is important to stress that we are doing this without diluting our shareholders," continued Dr. Coustas.

Under the Gemini Shareholders Agreement, Danaos has the right to purchase all of the beneficial interest in Gemini that it does not own for fair market value at any time afterDecember 31, 2018, or earlier if permitted under its credit facilities.


Source: Danaos Corporation


September 2015
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