Teekay, Marubeni to buy AP Moller-Maersk's LNG shipping unit for $1.4 bn

Teekay LNG Partners and Japanese trading company Marubeni Corp's joint venture yesterday agreed to buy Danish shipping group A P Moller-Maersk's liquefied natural gas (LNG) shipping unit, for $1.4 billion in cash.

The JV, the world's largest oil and gas shipping transporter is buying eight LNG carriers from Moller-Maersk, which has 100-per cent ownership interests in six LNG carriers and 26-per cent interest in two others.

The Copenhagen-based company said that five of the eight LNG carriers are currently operating under long-term, fixed-rate time-charter contracts, with an average remaining firm contract period of approximately 17 years, plus extension options.

The other three vessels are currently operating under short-term, fixed-rate time-charters; however, one of these charters includes an extension option which, if exercised, would increase the number of acquired vessels on long-term, fixed-rate charters to six.

The eight acquired vessel interests will increase the JV's total number of vessels, including the ones that are being built to 45 vessels. Teekay will take over technical management of the acquired vessels after a transition period.

To finance the deal, the JV has secured $1.12 billion loan facilities, and the remaining $280 million will be financed with equity contributions from Teekay and Marubeni.