Watson Farley & Williams Asia Practice (WFWAP) has advised a syndicate of banks led by the Bank of Tokyo-Mitsubishi UFJ as agent, and the Singapore branch of UniCredit Bank as security trustee, in relation to a $479,557,744 refinancing loan to a ship lease financing trust, a significant amount at a time when the global shipping industry is facing choppy waters.
The term facility was provided to FSL Trust Management, as trustee-manager for First Ship Lease Trust, to refinance the latter’s existing credit facility. The bank syndicate also included the Singapore branch of ABN AMRO, OCBC, the Singapore branch of Sumitomo Mitsui Banking Corp, the Singapore branch of UniCredit Bank, the Korea Development Bank, ITF Suisse and KfW IPEX-Bank.
The 25-ship fleet of First Ship Lease Trust, a SGX-listed trust that specialises in non-tax driven leasing services to the global shipping industry, was used to secure the term facility. The ships are on charter to a variety of international owners and operators, and thus the transaction involved coordination with local counsel and/or registries in Singapore, England, the Marshall Islands, Malta, Taiwan, Indonesia, Cyprus, Liberia, Panama, Italy, and the Bahamas.
Partner Goh Mei Lin led the WFWAP team, and was assisted by Shawn Er and Hayley Arrow. Allen & Gledhill acted as lead counsel for the borrower, while the main local counsels for the lenders included Arias B. & Associates in Panama, Higgs & Johnson in the Bahamas, and Asia Practice in Singapore.
Goh admitted that the number of ships, charterers and jurisdictions involved in the deal, along with existing market conditions, had made it a complicated transaction to pull off. “Some factors which were helpful in securing a financing of this size in this market include the fact that many of the lenders involved are lenders in the existing facility to FSL which the new facility is to refinance (and are, therefore, very familiar with FSL, its assets and its business operations),” she said. “Documentation was undertaken on an intensive basis as there were concerns about the possibility of further increases in funding costs.” ALB
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