Castor Maritime Inc. Announces Vessel Acquisition and Business Developments

Rhea-AI Summary

Castor Maritime Inc. (NASDAQ: CTRM) announced the acquisition of a 2006 Korean-built Aframax LR2 tanker for $18.15 million, expected to be finalized in December 2021. The tanker comes with a time charter at $15,000 per day, including a 50% profit-sharing arrangement, with about three months remaining on the contract. Additionally, the company secured a $23.15 million term loan facility and has fixed two dry bulk carriers on time charter agreements with gross daily rates of $19,000 and $17,500, further enhancing its shipping operations.

Positive

• Acquisition of a tanker expected to generate revenue through a profitable charter agreement.
• Secured $23.15 million in debt financing to support growth initiatives.
• New charter agreements for dry bulk carriers contribute additional income streams.

Negative

• Potential risks associated with debt financing impacting financial flexibility.

LIMASSOL, Cyprus, Dec. 07, 2021 (GLOBE NEWSWIRE) -- Castor Maritime Inc. (NASDAQ: CTRM), (“Castor”, or the “Company”), a diversified global shipping company, announces that it entered, through a separate wholly-owned subsidiary, into an agreement to acquire a 2006 Korean-built Aframax LR2 tanker from an unaffiliated third-party for a purchase price of $18.15 million. The acquisition is expected to be concluded by taking delivery of the vessel within December and is subject to the satisfaction of certain customary closing conditions.

The vessel will be delivered to the Company with a time charter contract attached, at a daily gross charter rate of $15,000 plus a 50% profit sharing arrangement over such level based on a predetermined formula. The charter has a remaining term of about three months (+/- 15 days).

Closing of Debt Financing

The Company also announces the closing and drawdown, through two of its dry bulk vessel shipowning entities, of a $23.15 million term loan facility, that it had entered into as previously announced on November 8, 2021.

New Charter Agreements

The M/V Magic Twilight, a 2010 built Kamsarmax dry bulk carrier, has been fixed on a time charter contract at a gross daily charter rate of $19,000. The charter commenced on November 29, 2021, and has a duration of about 45 days.

The M/V Magic Moon, a 2005 built Panamax dry bulk carrier, has been fixed on a time charter contract at a gross daily charter rate of $17,500. The charter commenced on December 3, 2021, and has a duration of about 60 days.

About Castor Maritime Inc.

Castor Maritime Inc. is an international provider of shipping transportation services through its ownership of oceangoing cargo vessels.

On a fully delivered basis, Castor will own a fleet of 28 vessels, with an aggregate capacity of 2.4 million dwt, consisting of 1 Capesize, 7 Kamsarmax and 11 Panamax dry bulk vessels, as well as 1 Aframax, 6 Aframax/LR2 and 2 MR1 tankers. Where we refer to information on a “fully delivered basis”, we are referring to such information after giving effect to the successful consummation of our recent vessel acquisitions.

For more information please visit the Company’s website at www.castormaritime.com 
Information on our website does not constitute a part of this press release.

Cautionary Statement Regarding Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. We desire to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are including this cautionary statement in connection with this safe harbor legislation. The words “believe”, “anticipate”, “intend”, “estimate”, “forecast”, “project”, “plan”, “potential”, “will”, “may”, “should”, “expect”, “pending” and similar expressions identify forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include general dry bulk and tanker shipping market conditions, including fluctuations in charter hire rates and vessel values, the strength of world economies the stability of Europe and the Euro, fluctuations in interest rates and foreign exchange rates, changes in demand in the dry bulk and tanker shipping industry, including the market for our vessels, changes in our operating expenses, including bunker prices, dry docking and insurance costs, changes in governmental rules and regulations or actions taken by regulatory authorities, potential liability from pending or future litigation, general domestic and international political conditions, potential disruption of shipping routes due to accidents or political events, the length and severity of the COVID-19 outbreak, the impact of public health threats and outbreaks of other highly communicable diseases, the impact of the expected discontinuance of LIBOR after 2021 on interest rates of our debt that reference LIBOR, the availability of financing and refinancing and grow our business, vessel breakdowns and instances of off-hire, potential exposure or loss from investment in derivative instruments, potential conflicts of interest involving our Chief Executive Officer, his family and other members of our senior management, and our ability to complete acquisition transactions as planned. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties. The information set forth herein speaks only as of the date hereof, and we disclaim any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication.

CONTACT DETAILS

For further information please contact:

Petros Panagiotidis
Castor Maritime Inc.
Email: ir@castormaritime.com 

Media Contact:
Kevin Karlis
Capital Link
Email: castormaritime@capitallink.com 

FAQ

What tanker did Castor Maritime acquire?

Castor Maritime acquired a 2006 Korean-built Aframax LR2 tanker.

What is the purchase price of the Aframax tanker?

The Aframax tanker was purchased for $18.15 million.

What are the terms of the tanker charter agreement?

The tanker comes with a time charter at $15,000 per day and a 50% profit-sharing arrangement.

When is the tanker acquisition expected to be finalized?

The acquisition is expected to be finalized by December 2021.

What financing has Castor Maritime secured recently?

Castor Maritime closed a $23.15 million term loan facility to support its operations.

What are the daily charter rates for the dry bulk carriers fixed by Castor Maritime?

The M/V Magic Twilight has a charter rate of $19,000, and the M/V Magic Moon has a charter rate of $17,500.