Seaspan Corporation a wholly owned subsidiary of Atlas Corp. has entered into long-term charters with ZIM Integrated Shipping Services (ZIM) relating to ten ultra-modern 7,000TEU dual-fuel LNG newbuilds.
Seaspan will now enter into agreements with a major shipyard to construct the vessels which are anticipated to begin deliveries in the fourth quarter of 2023 and through 2024. The ships are anticipated to be financed from existing liquidity, cash flow from operations, and additional borrowings.
Bing Chen, Chairman, President and CEO of Seaspan, commented, “We are very pleased to collaborate with ZIM on this forward-thinking project which provides advanced designs, competitive pricing and valuable deliveries. We see these modern 7,000 TEUs to be the natural successor to the aging global pool of conventional vessels in the 4,000 to 9,000 TEU range, where relatively little fleet renewal has taken place. We are experiencing strong customer interest for this vessel size.”
Graham Talbot, CFO of Seaspan, added, “We continue to execute on our growth plan in a prudent manner. In line with all of our vessel investments, we have de-risked the $1.05 billion capital expenditure associated with the dual-fuel LNG Containerships by signing long-term charters with a leading global liner representing approximately $1.8 billion of contracted cash flow. We intend to maintain balance sheet and risk management integrity while continuing the growth track that we have established over Seaspan’s 20-year history. We remain diligent on our path toward an investment grade credit rating, and operational scale will play an important role in this pursuit.”
Since December 2020, and including this announcement, Seaspan has announced 55 newbuild vessel orders and the acquisition of four second-hand vessels, all four of which have since been delivered.
The latest order will significantly increase the capacity of the Seaspan’s fleet which at end of March this year consisted of 127 containerships representing total capacity of approximately 1,073,200 TEU. Since then, the delivery of four second-hand vessels, increased Seaspan’s operating fleet to 131 vessels and 1,120,200 TEU. The 55 vessels under construction will further increase total capacity to 1,854,200 TEU, on a fully delivered basis. It is anticipated that some older vessels will be disposed of reducing the overall capacity.