MoU Signed to Sell Off two of ESL Shipping's Supramaxes

An empty boardroom
Updated Published

ESL Shipping has entered into an agreement to divest its two Supramax class ships, Arkadia and Kumpula, to entities under the HGF Denizcilik Limited Sirket group, a Turkish maritime and logistics firm. This transaction is a step in ESL Shipping's April 2023-announced initiative aimed at fostering the company's eco-friendly growth.

The handover of these ships is slated for April to May 2024, with the transaction valued at USD 37.1 million, to be settled entirely in cash. Given the book value of these vessels and associated selling expenses, the deal is anticipated to result in a loss of around EUR 7 million.

Post-sale, ESL Shipping's operations will pivot to concentrating on Handysize and Coaster class vessels, enhancing its collaborative endeavors with its existing and prospective clientele. In 2023, the Supramax vessels contributed EUR 1.6 million (down from EUR 5.7 million in 2022) to the operating profit.

Rolf Jansson, CEO of Aspo Group and ESL Shipping’s Chairman, remarked, “The sale of the two Supramax vessels is well aligned with ESL Shipping’s low-carbon strategy. It also stabilizes ESL Shipping’s profit generation and frees up capital for Aspo’s and ESL Shipping’s future strategic growth efforts.”

Acquired in 2012, the two 1A ice-class Supramax vessels, each with a deadweight of 56,000 tons, measure 197 meters in length and can achieve a maximum draft of 13.0 meters when fully loaded. Both vessels, m/s Arkadia and m/s Kumpula, have been operating under the Finnish flag.

Mikki Koskinen, ESL Shipping's Managing Director, stated, “As the traditional markets for our Supramax vessels on the Baltic Sea and the Arctic have changed significantly, now is the right time to sell these vessels. The sale will support our roadmap towards green shipping and our ambition to bring fossil-free handysize vessels to the market. The sale enables us to allocate even more resources to accelerate the green transition,“

ESL Shipping intends to offer alternative positions within its fleet to the crews of the sold Supramax vessels, wherever feasible.