Frontline has signed an agreement to sell its five oldest Very Large Crude Carriers (VLCCs), built in 2009 and 2010, for a total net sale price of $290 million to replace them with more efficient ships.
The vessels are scheduled for delivery to the new owner in the first quarter of 2024. After settling the existing debt on the vessels, the deal is expected to generate net cash proceeds of around $207 million. Frontline anticipates recording a gain in the first quarter of 2024, ranging from approximately $68 million to $76 million, depending on the delivery dates of each vessel. The sale is subject to standard closing conditions.
According to the company, the divestment of older vessels allows the company to streamline its operations, focusing on vessels with advanced technology and energy-efficient features.
Lars H. Barstad, the CEO of Frontline Management AS, expressed satisfaction with the transaction, highlighting the capture of firm pricing for 14-15-year-old vessels, as the move aligns with Frontline’s strategy of optimizing its fleet.
