TEN Ltd. Announces the Acquisition of a Fleet of Five Modern Environmentally-Friendly Vessels
- Acquisition of five high-spec environmentally-friendly vessels
- Vessels have an average employment of two years with fixed and profit-sharing features totaling over $100 million in minimum gross revenues
- Increased number of LNG-powered tankers, scrubber-fitted vessels, and vessels with ice-class capabilities
- Pro-forma fleet increased to 72 diversified ships of all categories
- None.
Insights
The acquisition of five high-spec environmentally-friendly vessels by TEN Ltd represents a strategic move in the maritime transport sector, aimed at modernizing the fleet and capitalizing on the growing demand for eco-friendly transportation solutions. The deal, which includes a mix of Dual-Fuel LNG LR2 aframaxes, a super-eco suezmax and ice-class scrubber-fitted aframaxes, indicates a shift towards cleaner energy sources and compliance with stricter environmental regulations.
The financial implications of this acquisition are significant, with an expected addition of over $100 million in minimum gross revenues, suggesting a robust revenue stream for TEN in the coming years. The funding through cash-at-hand and bank finance indicates a balanced approach to capital allocation, which is crucial for maintaining financial stability. Investors should note the potential for enhanced profitability due to the fixed and profit-sharing employment contracts associated with these vessels.
However, the capital-intensive nature of the shipping industry and the reliance on global trade dynamics mean that investors should carefully monitor the market conditions and regulatory changes that could affect the operational efficiency and cost structures of these assets.
The introduction of Dual-Fuel LNG-powered and scrubber-fitted vessels reflects a growing industry trend towards sustainability and environmental stewardship. LNG as a marine fuel significantly reduces emissions compared to conventional heavy fuel oil, aligning with the International Maritime Organization's (IMO) 2020 sulphur cap and upcoming greenhouse gas emissions reduction targets. The presence of ice-class capabilities in the fleet also highlights a strategic advantage for TEN, as it allows operations in harsher, ice-prone environments, potentially opening up new trade routes.
While the environmental benefits of such vessels are clear, the company must navigate the challenges of LNG infrastructure and fuel availability. The long-term success of this strategy will depend on the development of global LNG bunkering facilities and the maritime industry's transition towards a low-carbon future.
The acquisition is poised to enhance TEN's competitive advantage in the shipping industry, particularly in the eco-friendly vessel segment. By increasing the number of LNG-powered and scrubber-fitted vessels, TEN is positioning itself to meet the increasing demands of blue-chip clients who are prioritizing environmental considerations in their supply chain decisions.
Given the vessels' advanced features and the current market trends favoring sustainability, TEN's fleet expansion could attract premium charter rates and longer-term contracts, contributing to revenue growth and stability. It is essential to monitor peer performance and industry capacity to assess whether TEN's growth program aligns with market expectations and if they are ahead or in line with competitors in terms of fleet modernization and environmental compliance.
Vessels chartered to a major energy company
Three vessels to be delivered with Special-Survey passed
LNG-powered tankers in TEN’s fleet increase to six
11 eco-friendly vessels to join the fleet
ATHENS, Greece, Jan. 31, 2024 (GLOBE NEWSWIRE) -- TEN, Ltd (TEN) (NYSE: TNP) (the “Company”) announces the acquisition of five high-spec environmentally-friendly vessels from Norway’s Viken Crude AS. The fleet is comprised of two 2023-built Dual-Fuel LNG LR2 aframaxes, one 2019-built super-eco suezmax and two 1A ice-class scrubber-fitted aframaxes built in 2018 and 2019 respectively.
The vessels have an average employment of two years with fixed and profit-sharing features totaling over
TEN will fund the purchase with cash-at-hand and bank finance.
With this acquisition, TEN’s LNG-powered tankers, after the recent delivery of its four-new vessel program, increases to six, its scrubber-fitted vessels to 12, its vessels with ice-class capabilities to 17 and the pro-forma fleet to 72 diversified ships of all categories.
“Following the sale of 9 first generation vessels in the last 12 months and having initiated our LNG-powered tanker renewal program, we are delighted to acquire this modern eco fleet and underscore TEN’s commitment to operate environmentally-friendly vessels to meet the increasing demands of our blue-chip clientele,” Mr. George Saroglou, President & COO of TEN, commented. “With 11 vessels now joining TEN going forward, including the six under construction, the revenue growth capacity of the fleet and its expected impact to the bottom line, is materially enhanced,” Mr. Saroglou concluded.
Nordea Corporate Finance, part of Nordea Bank Abp, filial in Norway, acted as advisor to the seller in relation to the transaction.
TEN’s CURRENT GROWTH PROGRAM
| # | Name | Type | Delivery | Status | Employment |
| 1 | Njord DF | Aframax Dual Fuel | Sep. 2023 | Delivered | Yes |
| 2 | Ran DF | Aframax Dual Fuel | Oct. 2023 | Delivered | Yes |
| 3 | Chios DF | Aframax Dual Fuel | Jan. 2024 | Delivered | Yes |
| 4 | Ithaki DF | Aframax Dual Fuel | Jan. 2024 | Delivered | Yes |
| 5 | TBN | DP2 Shuttle Tanker | Q2 2025* | Under Construction | Yes |
| 6 | TBN | DP2 Shuttle Tanker | Q2 2025* | Under Construction | Yes |
| 7 | TBN | Suezmax – Scrubber Fitted | Q2 2025* | Under Construction | Under Discussion |
| 8 | TBN | Suezmax – Scrubber Fitted | Q4 2025* | Under Construction | Under Discussion |
| 9 | TBN | MR – Scrubber Fitted | Q1 2026* | Under Construction | Under Discussion |
| 10 | TBN | MR – Scrubber Fitted | Q1 2026* | Under Construction | Under Discussion |
| *Expected delivery as per shipbuilding contracts | |||||
ABOUT TEN
TEN, founded in 1993 and celebrating this year 30-years as a public company, is one of the first and most established public shipping companies in the world. TEN’s diversified energy fleet currently consists of 72 double-hull vessels, including two DP2 shuttle tankers, two scrubber-fitted suezmax vessels and two scrubber-fitted MR product tankers under construction, constituting a mix of crude tankers, product tankers and LNG carriers, totaling 8.8 million dwt.
ABOUT FORWARD-LOOKING STATEMENTS
Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. TEN undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise.
For further information, please contact:
Company
Tsakos Energy Navigation Ltd.
George Saroglou
President & COO
+30210 94 07 710
gsaroglou@tenn.gr
Investor Relations / Media
Capital Link, Inc.
Nicolas Bornozis
Markella Kara
+212 661 7566
ten@capitallink.com
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