NOL Completes $1.1 Billion in Ship Financing

NOL Completes $1.1 Billion in Ship Financing

Neptune Orient Lines said Thursday it completed $1.1 billion in loan agreements and documentation with financial institutions providing financing for the 12 container ships the carrier ordered last year and two vessels ordered in 2007.

The Singapore-based parent of APL ordered 12 vessels with capacities of 8,400 20-foot equivalent units in December and at the same time secured a $150 million term loan for the two ships of 10,700-TEUs it had ordered in 2007.

NOL’s announcement means it has also completed financing for the 12 8,400-TEU ship orders placed last year with South Korea's Daewoo Shipbuilding & Marine Engineering.

The world’s seventh-largest shipping line, which refrained from ordering new ships during the shipping boom that ended in 2008, ordered the new ships for its container line, APL. The ships will be delivered in 2013 and 2014.

NOL Group CEO and President Ron Widdows told The Journal of Commerce in March the carrier had started ordering new ships last year as prices for new ship orders declined. “Ship prices have come down, and that gives us an opportunity to retool our asset cost,” Widdows said.

NOL said it does not expect to draw on any of the new loan facilities in 2011, and are not expected to have any material impact on the financials for the group this year.

-- Contact Peter T. Leach at pleach@joc.com. Follow him on Twitter @petertleach.