NAT: New capital structure; major breakthrough securing financing of minimum 5 years.

Nordic American Tankers (NAT)

Nordic American Tankers announced it has agreed a $306m loan with a US bank. The company’s announcement to shareholders reads:

We are pleased to announce that NAT has entered into a five-year $306 million senior secured credit agreement arranged by CSG Investments, Inc., and funded by Beal Bank of Dallas, Texas. The loan will retire the present Revolving Credit Facility (“RCF”) in full.

The new credit will see the effective interest be reduced compared to what was paid under the old RCF at the end of 2018. It is also lower than what was indicated to us for the Secured Bond we contemplated in 2018 and the Back-Stop facility that was cancelled in 3Q18. The new loan will amortize as per a 20-year profile with full maturity after 5 years. The arrangement is positive for NAT.

The financing will continue to secure a competitive cash break-even rate for NAT. More importantly, the new loan allows NAT greater flexibility in setting dividend payments.

The NAT shares are actively traded several places in the US. With this new US based debt facility, together with the NAT leased three 2018 new buildings, all major financial aspects of NAT are efficiently settled.

The debt level of NAT has always been among the lowest in the industry. The NAT board has focus on further reducing the debt to a level that NAT maintained a few years ago.

The market for our Suezmaxes is solid. The plan announced today also positions NAT well for the future.

The investment banking arm of Arctic Securities has assisted NAT in the transaction.



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