(EnergyAsia, October 31 2011, Monday) — Canada’s maritime transport group Teekay LNG and Japanese trading house Marubeni Corp have agreed to jointly buy Danish shipping group AP Moller-Maersk’s liquefied natural gas (LNG) shipping subsidiary for US$1.402 billion.
In separate statements, the companies said the new joint venture firm will fully acquire six of the subsidiary’s LNG carriers and a 26% stake in two others that have been committed to serve Qatar, with the right to purchase the remaining 74%.
Teekay LNG, which holds a 52% stake in the JV, said that five of the carriers are operating under long-term, fixed-rate time-charter contracts, with an average remaining firm contract period duration of 17 years with extension options. The other three vessels have been committed on short-term fixed-rate time-charters.
The vessels were built by South Korea’s Samsung Heavy Industries Co Ltd between 2004 and 2010.
To finance the acquisition, the JV will draw upon loan facilities totalling US$1.12 billion and US$280 million in equity contributions from Teekay LNG and Marubeni in a 52/48 share.
Describing this as Teekay LNG’s largest acquisition of on-the-water vessels to date, Peter Evensen, CEO of Teekay GP LLC, said:
“The eight acquired vessel interests will increase the total number of vessels in which we have ownership interests, including committed newbuildings, to 45 vessels, and the time-charter contracts acquired with these vessels will broaden our customer base and add further stable cash flows to our existing large portfolio of long-term fixed-rate contracts.
“With three of the vessels currently employed on short-term time-charters, the partnership should benefit from the strong near-term demand for LNG carriers. With an average age of only four years, we are acquiring a modern, well-maintained fleet that has been operated by one of the leaders in global shipping.”
With this deal, Marubeni will expand its footprint in the LNG business to follow on last year’s acquisition of a 49% stake in a fleet of eight LNG carriers from BW Gas Ltd.
In a statement on May 11 2011, A.P. Moller-Mærsk had declared its intention to divest the LNG fleet to focus on its core businesses.
Stating that Maersk LNG does not have the scale “to significantly influence the overall development of the industry,” the Danish firm said it will not have any LNG vessels in its fleet upon expected completion of the sale later this quarter.
Claus V. Hemmingsen, a member of the A.P.Moller-Maersk board with responsibility for the LNG unit, said:
“Teekay and Marubeni jointly represent an unrivalled owner of Maersk LNG and we are very satisfied that we have been able to transfer the ownership of Maersk LNG to such renowned and reliable owners with clear and strong strategic, long-term interests in the LNG transportation business.”
Teekay LNG Partners LP is a publicly-traded master limited partnership formed by NYSE-listed Teekay Corp as part of its strategy to expand its operations in the LNG and LPG shipping sectors.
Teekay LNG Partners LP provides LNG, LPG and crude oil marine transportation services primarily under long-term, fixed-rate charter contracts with major energy and utility companies through its fleet of 21 LNG carriers (including one LNG regasification unit), five LPG and multigas carriers and 11 conventional tankers.
Teekay LNG Partners holds stakes ranging from 33% to 100% in these vessels. Two of the LNG carriers are newbuildings scheduled for delivery in 2011 and 2012.
Marubeni Corp and the A.P. Moller – Maersk Group are business conglomerates involved in many business sectors and activities across the world.