Performance Shipping announced that it has entered into an agreement for a new amortizing term loan facility of up to approximately US$31.9 million with Piraeus Bank through two separate wholly-owned subsidiaries of the Company.
Proceeds from the Facility will be used to refinance approximately US$7.3 million of the existing term loan facility with Piraeus Bank S.A. secured by the M/T P. Yanbu and to partially finance the previously-announced acquisition of the Company’s sixth Aframax tanker vessel, to be renamed M/T P. Sophia, through a second advance of up to approximately US$24.6 million.
The Facility shall bear interest at the rate of LIBOR plus a margin of 2.70% per annum. Based on the amount expected to be drawn down under both advances, the Facility will be repayable in twenty consecutive quarterly installments of US$0.8 million each, and a balloon installment of US$15.9 million payable concurrent with the twentieth quarterly installment. The Facility will be secured by, among other things, a guarantee of the Company and first priority mortgages over the M/T P. Yanbu and M/T P. Sophia.
Commenting on the Facility, Andreas Michalopoulos, the Company’s Chief Executive Officer, stated:
“We are very pleased to announce the entry into this new term loan facility with Piraeus Bank at attractive terms to complete funding for the acquisition of M/T P. Sophia. With the financing of the acquisition of our sixth Aframax tanker now secured, we are well-positioned to capitalize on the current favorable tanker charter market with spot charter rates for Aframax tankers quoted at approximately $28,000 and strong fundamentals going forward. We expect to take delivery of the M/T P. Sophia as early as next week and look forward to generating strong cashflows with our expanded fleet.”