BW LPG India offloads 18-year-old VLGC for over $80m

New York- and Oslo-listed gas carrier giant BW LPG is cashing in again on strong secondhand values, agreeing to sell an 18-year-old VLGC for more than $80m as it presses ahead with a major fleet renewal programme.

The company’s 52%-owned subsidiary, BW LPG India, has signed an agreement to sell the 2008-built, 84,601 cu m BW Loyalty for continued trading.

BW LPG said the vessel had fetched a price in the low-$80m range, with the transaction expected to generate a gain of approximately $52m and net cash proceeds of around $66m after taxes and transaction costs.

Both figures are calculated on a 100% ownership basis, rather than BW LPG’s attributable 52% stake in the Indian subsidiary.

The ship will remain on its existing time charter before changing hands, with the sale expected to be completed by December. The buyer has not been disclosed.

The latest disposal adds to a string of profitable sales by the Indian operation.

In August, BW LPG India agreed to sell the 2007-built BW Birch, expecting approximately $64m in net cash proceeds and a $37m gain. That followed the July sale of another 2007-built VLGC, BW Elm, which generated around $64m in cash and a $36m book gain.

Including BW Loyalty, the three announced transactions represent approximately $194m in net cash proceeds and $125m in gains on a 100% basis, although the latest sale has yet to close.

The disposals come as BW LPG embarks on its largest newbuilding programme in years. In May, the company contracted eight 90,000 cu m panamax VLGCs at HD Hyundai Heavy Industries for approximately $940m, with deliveries scheduled between 2029 and 2030.

The group subsequently raised $300m through a convertible bond offering in September, with the proceeds earmarked partly for financing the newbuilding programme.

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