Zim in second LNG dual-fuel box ship deal with Seaspan

Written by Nick Blenkey
ZIM logo on side of ship


Containership leasing giant Seaspan Corporation, a wholly owned subsidiary of Atlas Corp. (“Atlas”) (NYSE:ATCO),, today reported that it has entered into long-term charters with Haifa, Israel , headquartered ZIM Integrated Shipping Services Ltd. (NYSE: ZIM) relating to ten ultra-modern 7,000 TEU dual-fuel liquefied natural gas (LNG) containership newbuilds. This latest charter is additional to the agreement for the charter of ten 15,000 TEU LNG dual fuel containerships announced by the two companies back in February,

Seaspan says it will enter into agreements with a major shipyard to construct the ships, with deliveries expected to begin in the fourth quarter of 2023 and continue through 2024. The ships are anticipated to be financed from existing liquidity, cash flow from operations, and additional borrowings.

According to ZIM, this latest agreement has a monetary value in excess of $1.5 billion and the ships will serve across ZIM’s various global-niche trades.

“We are very pleased to once again partner with Seaspan as we strategically enhance our operating fleet to further facilitate our long-term strategy,” said Eli Glickman, ZIM President & CEO. “With this second long-term chartering agreement, we are securing access to our core fleet, while maintaining operational agility with respect to the total number of vessels we operate. Since going public, and further evidenced by this transaction, we remain committed to deploying capital prudently and enhancing shareholder value.”

“Keeping with our commitment to reducing our carbon footprint and preserving our oceans, we are investing in state-of-the-art ‘green’ vessels that use the cleanest technology currently available.” Glckman continued. “We are proud that this transaction will further improve our carbon intensity standing among the global liners.”

“We see these modern 7,000 TEUs to be the natural successor to the aging global pool of conventional vessels in the 4,000 to 9,000 TEU range, where relatively little fleet renewal has taken place,” said Bing Chen, Chairman, President and CEO of Seaspan. ‘We are experiencing strong customer interest for this vessel size.”

“We continue to execute on our growth plan in a prudent manner,” added Graham Talbot, CFO of Seaspan “We are very pleased to collaborate with ZIM on this forward-thinking project which provides advanced designs, competitive pricing and valuable deliveries. In line with all of our vessel investments, we have de-risked the $1.05 billion capital expenditure associated with the dual-fuel LNG containerships by signing long-term charters with a leading global liner representing approximately $1.8 billion of contracted cash flow. We intend to maintain balance sheet and risk management integrity while continuing the growth track that we have established over Seaspan’s 20-year history. We remain diligent on our path toward an investment grade credit rating, and operational scale will play an important role in this pursuit.”

Since December 2020, and including today’s announcement, Seaspan has announced 55 newbuild vessel orders. It has also acquired four second-hand vessels, all four of which have since been delivered, the most recent being two 15,000 TEU scrubber-fitted containerships, built in 2019 and now on a long-term charter with a long-standing global liner customer.

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