Aker Philly and Crowley seal JV deal

Pennsylvania, one of first two Jones Act tankers delivered to Crowley by Aker Philadelphia Pennsylvania, one of first two Jones Act tankers delivered to Crowley by Aker Philadelphia

NOVEMBER 8, 2013 — Aker Philadelphia Shipyard ASA (Oslo: AKPS) reports that its wholly owned U.S. subsidiary, Aker Philadelphia Shipyard, Inc. (APSI), and Crowley Maritime Corporation have completed definitive documentation and satisfied the closing conditions for the joint venture related to the operation and chartering of at least four product tankers.

The transaction was originally announced on August 9, 2013. The agreements include binding shipbuilding contracts for the first four product tankers, which were signed on August 9, 2013, and options to build additional product tankers.

APSI has also signed a commitment letter with PIDC Regional Center, a partnership between CanAm Enterprises and PIDC, for a secured term loan of up to $60 million at a fixed interest rate of 2.75%. This loan is expected to be fully funded by Q1 2015 with a five-year maturity occurring in 2019. This loan will be made through the Welcome Fund loan program, a source of low-cost capital generally available to commercial, retail, industrial or non-profit firms that create significant job growth and are located in or planning to locate to the City of Philadelphia. This term debt facility is subject to agreement on definitive documentation and satisfaction of customary closing conditions.

APSI is also in the process of finalizing a commitment for an additional secured loan of up to $65 million. It is expected that the two secured loans, once closed, will fulfill all of APSI's financing needs for its current backlog, which extends to Q4 2018, including the Matson containership project reported yesterday.

As reported in the AKPS Q3 2013 report, APSI has also signed a commitment letter with Caterpillar Financial Services for $120 million of construction financing for the first four product tankers with Crowley.