Danaos Corporation Announces Senior Notes Offering

Rhea-AI Summary

Danaos Corporation (NYSE: DAC) announced an offering of up to $300 million of senior unsecured notes due 2028, subject to market conditions. The funds from this offering, along with a new $815 million credit facility and a $135 million sale leaseback arrangement, are intended for a $1.25 billion refinancing of a significant portion of its existing senior secured debt. The notes will be offered in a private placement exempt from registration under the Securities Act, and are not available for sale in certain jurisdictions.

Positive

• The offering aims to refinance $1.25 billion of senior secured debt, enhancing financial stability.
• The company is securing additional funding through an $815 million senior secured credit facility.

Negative

• The reliance on refinancing indicates a potential liquidity risk, depending on market conditions.

Danaos Corporation (the “Company”) (NYSE: DAC) announced today that it plans to commence an offering of up to $300 million of senior unsecured notes due 2028, subject to market conditions and other factors. The notes are to be offered and sold in a private offering exempt from the registration requirements under the U.S. Securities Act of 1933, as amended (the "Securities Act"). The Company intends to use the net proceeds from the offering, together with a new $815 million senior secured credit facility and a new $135 million sale leaseback arrangement, to implement a $1.25 billion refinancing of a substantial majority of its outstanding senior secured indebtedness.

This announcement is not an offer for sale or a recommendation or solicitation to buy or sell any securities, nor shall there be any offer, solicitation, or sale of any securities in any jurisdiction in which such offer, solicitation, or sale would be unlawful. The notes will not be registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements of the Securities Act and applicable state securities laws.

About Danaos Corporation

Danaos Corporation is one of the largest independent owners of modern, large-size containerships. Our current fleet of 65 containerships aggregating 403,793 TEUs, including five vessels owned by Gemini Shipholdings Corporation, a joint venture, ranks Danaos among the largest containership charter owners in the world based on total TEU capacity. Our fleet is chartered to many of the world’s largest liner companies on fixed-rate charters. Danaos Corporation’s shares trade on the New York Stock Exchange under the symbol “DAC”.

Forward-Looking Statements

Matters discussed in this release may constitute forward-looking statements within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements reflect the current views of Danaos Corporation (including subsidiaries unless indicated or the context requires otherwise, the “Company,” “we,” “us,” and “our”) with respect to future events and financial performance and may include statements concerning our operations, cash flows, financial position, including with respect to vessel and other asset values, plans, objectives, goals, strategies, future events, performance or business prospects, changes and trends in our business and the markets in which we operate, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions. 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. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the impact of the novel coronavirus 2019 (“COVID-19”) pandemic and efforts throughout the world to contain its spread, including effects on global economic activity, demand for seaborne transportation of containerized cargo, the ability and willingness of charterers to fulfill their obligations to us, charter rates for containerships, shipyards performing scrubber installations, drydocking and repairs, changing vessel crews and availability of financing, the effects of the refinancing transactions in 2018, the effects of the contemplated upcoming refinancing transactions, the Company’s ability to achieve the expected benefits of its refinancing transactions and comply with the terms of its credit facilities and other agreements entered into in connection with the such refinancings, the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydocking, changes in our operating expenses, including bunker prices, dry-docking and insurance costs, ability to obtain financing and comply with covenants in our financing arrangements, actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by Danaos Corporation with the U.S. Securities and Exchange Commission.

The forward-looking statements and information contained in this announcement are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210128005673/en/

FAQ

What is Danaos Corporation's latest offering amount?

Danaos Corporation announced an offering of up to $300 million in senior unsecured notes.

What will the proceeds from the offering be used for?

The proceeds will be used for refinancing a substantial majority of the company's senior secured indebtedness.

When are the senior unsecured notes due?

The senior unsecured notes are due in 2028.

What financing arrangements accompany the new notes offering?

The offering is complemented by an $815 million senior secured credit facility and a $135 million sale leaseback arrangement.

Is the offering registered under the Securities Act?

No, the notes are offered in a private placement exempt from the registration requirements under the Securities Act.