The Board of Directors (the “Board”) of FSL Trust Management Pte. Ltd., as trustee-manager (the “Trustee-Manager”) of First Ship Lease Trust (the “Trust”), refers to its announcement dated 30 August 2021 and further announces that the disposal of the vessel FSL New York (the “Vessel”) has been completed with the successful delivery of the Vessel to the new owners Haein Shipping Co., Ltd. (the “Buyer”), an unaffiliated third party, on 29 September 2021 (the “Disposal”).
The gross consideration paid by the Buyer for the Vessel upon delivery was US$10.0 million, which was arrived at after arm’s lengths negotiations between FSL-9, Inc. ( “FSL-9”), the subsidiary of the Trust owning the Vessel, and the Buyer on a “willing buyer willing seller” basis, taking into consideration the prevailing and expected charter market environment and earnings prospects for the Vessel, the capital expenditure for the upcoming dry-docking for special survey of the Vessel and the installation of a mandatory ballast water treatment system, the Vessel’s expected economic life and residual value and the supply and demand for vessels of the same type and with similar specifications in the sale and purchase market. On the basis of these considerations, the Board has concluded that the Disposal is expected to be value accretive and more beneficial to the Trust and its unitholders than keeping the Vessel in the portfolio of the Trust.
In determining the adequacy of the gross consideration for the Disposal, the Trustee-Manager also took into account the valuation of the Vessel which it obtained from a reputable, independent third party shipbroker who valued the Vessel at US$9.5 million on the basis of a sale between a willing seller and a willing buyer, without any charter attached and for cash payment on delivery, as at the valuation date 16 August 2021. The valuation report is available for inspection during normal business hours at the registered office of the Trustee-Manager by prior appointment only, due to and subject to the prevailing COVID-19 restriction orders in Singapore, for 3 months from the date of this announcement.
The net book value and the net tangible asset (“NTA”) value of the Vessel upon Disposal was approximately US$9.0 million (unaudited). After taking into consideration the cost of the Disposal (including brokerage commissions and legal fees), the Trust realised a net gain of approximately US$0.3 million (unaudited) and net sales proceeds of approximately US$9.3 million (unaudited), which are intended to be used for general corporate purposes of the Trust.
Based on the last announced unaudited consolidated financial statements of the Trust and its subsidiaries (the “Group”) for the financial period ended 30 June 2021, the relative figures for the Disposal computed on the relevant bases set out in Rule 1006 of the Listing Manual (the “Listing Manual”) of the Singapore Exchange Securities Trading Limited (“SGX-ST”) are as follows:
Source: FSL Trust Management Pte. Ltd.