Seaspan Corporation, the world’s largest independent containership owner operator, announced today that it has acquired the remaining 89% it did not own of Greater China Intermodal Investments LLC from affiliates of The Carlyle Group and the minority owners of GCI.
This acquisition solidifies Seaspan’s industry-leading position as the world’s largest independent containership owner operator, and highlights Seaspan’s strength and ability to achieve sustained growth and drive consolidation in the fragmented containership sector. By expanding Seaspan’s fleet and deepening its customer relationships, Seaspan is well-positioned to offer its customers, the world’s leading container liners, enhanced service and capabilities.
The implied enterprise value of GCI is approximately USD1.6 billion, including assumed third party net debt of approximately USD1.0 billion and USD140 million of future vessel payments. The consideration to selling shareholders will be cash of approximately USD330 million and a USD50 million issuance of Seaspan Series D preferred shares. Seaspan financed the cash consideration with cash from its balance sheet and a USD16 million reinvestment by the Washington family in Seaspan common equity. Seaspan has also closed on a USD100 million secured credit facility from Citi.
Bing Chen, President and Chief Executive Officer of Seaspan, stated, “This significantly accretive acquisition materially increases our contracted future revenues and enhances our ability to provide our customers with modern, state-of-the-art containerships. With GCI’s fleet now under our ownership, we are strengthening our partnerships with customers and enhancing our scalable integrated platform for sustained growth and future consolidation. As the container shipping industry is beginning to show signs of a recovery, we are taking decisive actions to capitalize on compelling opportunities in our market.”
GCI’s fleet of 18 modern containerships is comprised of high quality 10,000 TEU and 14,000 TEU eco-class vessels, representing a total of 204,000 TEU. Of these 18 vessels, there are currently 16 on-the-water vessels with the remaining two newbuild vessels scheduled for delivery during the second quarter of 2018. Seaspan has been involved in the design, construction, delivery and operations of all 18 of GCI’s vessels since inception. All of these vessels are sister ships to Seaspan’s current fleet. Given Seaspan’s operating history of GCI’s fleet, there is no operational integration risk.
GCI’s current fleet will contribute approximately $1.3 billion towards Seaspan’s contracted future revenues, increasing Seaspan’s total contracted future revenues to approximately USD5.6 billion. In calendar year 2019, with an 18 vessel fleet, GCI is expected to generate USD185 million to USD200 million in annual EBITDA.
The Combined Fleet of SSW and GCI
| Seaspan | GCI | Combined | |
| Vessels (including newbuilds) | 94 | 18 | 112 |
| Fleet TEU (including newbuilds) | 701,900 | 204,000 | 905,900 |
| TEU-Weighted Avg. Remaining Charter Period | 5.2 years | 5.4 years | 5.2 years |
| TEU-Weighted Avg. Vessel Age | 6.1 years | 2.6 years | 5.4 years |
| Avg. Vessel Size | 7,500 TEU | 11,333 TEU | 8,100 TEU |
| Future Contracted Revenue (US$) | $4.3B | $1.3B | $5.6B |
