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Cosco Shipping finance unit in $187m sale and leaseback deal with Golar LNG

Cosco Shipping Development Co, has sealed a sale and leaseback deal with a unit of global LNG shipping player Golar LNG (GLNG) to purchase the 160,000 c um 2014-built LNG carrier Golar Crystal with an eventual repurchase option.

Cosco Shipping Development unit Oriental Fleet agreed with GLNG unit Golar Hull to buy the vessel for $187m and charter it back to the latter for 10 years the company said.

Golar Hull is set to pay $75m upfront for the bareboat charter, which will be offset against the sale price and approximately another $62m in charter fees, payable every quarter, with a variable financing component as well.

Golar Hull has the option to buy back the vessel at the end of the charter period or be subject to a $50m balloon payment penalty if not exercised.

Cosco Shipping Development noted that the deal would facilitate the expansion of the group's ship leasing business and enhance its profitability.

Cosco Shipping Development is the former China Shipping Container Lines which was transformed into an integrated financial services platform focussing on ship leasing and ship financing after the merger of Cosco and China Shipping last year.

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