LNG carrier operator Dynagas LNG Partners announced it has secured a $675 million syndicated loan from leading international banks. The loan will be secured by, among other things, first priority mortgages on the six LNG carriers in the partnership’s fleet.
This move is expected to help the company eliminate its existing dept of totaling $720 million.
The loan is repayable over five years in 20 consecutive quarterly payments, based on a 14 year amortization profile and has a margin of LIBOR plus 300 basis points.
The terms of the Credit Facility include financial covenants providing for the maintenance of maximum leverage ratios and minimum liquidity covenants, including the requirement for the Partnership to maintain a minimum cash balance of $50 million throughout the life of the Credit Facility in a restricted collateral account.
The Partnership expects the financing to close before the end of September, subject to customary closing conditions.
We are pleased to enter into this transformative re-financing. The Credit Facility provides the Partnership with reduced cost of debt relative to the existing one and a simplified debt structure with a clear and viable path towards deleveraging through a significant increase in debt amortization. The Partnership has in place long term charter contracts with international energy companies, generating cash flows that will be channeled towards the amortization requirements of the Credit Facility, building equity value over time. As a result of this global refinancing and broader strategic realignment, the Partnership is better positioned for future growth initiatives as global LNG markets continue their robust development,
…said Tony Lauritzen, CEO of Dynagas LNG Partners.
