The vessels are expected to be delivered to the new owners during the fourth quarter of 2021 and the first quarter of 2022. After repayment of existing debt on the vessels, the transaction is expected to generate net cash proceeds of approximately $67.0 million, and the Company expects to record a total gain divided between the fourth quarter of 2021 and the first quarter of 2022 of approximately $11.2 million.
Lars H. Barstad, Chief Executive Officer of Frontline Management AS commented:
“We are very pleased with this transaction. LR2 asset prices have appreciated firmly this year, and although we believe the tanker market in general looks promising going forward, we found it compelling to capture value at this point in the curve. Frontline has increased its position significantly in the VLCC segment during 2021 and this divestment from our LR2 fleet will in part finance our growth ambitions for the larger crude carriers.”
Following this transaction, Frontline’s fleet, including newbuildings, consists of 74 vessels with an aggregate capacity of approximately 14.3 million dwt. The Company’s fleet is comprised of 25 VLCCs, 27 Suezmax tankers, 18 LR2 / Aframax product tankers and four vessels that are under the Company’s commercial management (two Suezmax tankers and two Aframax tankers).