Maersk Tankers creates new credit facility to strengthen pool cash flow
Maersk Tankers has created a new USD 150 million uncommitted credit facility with Citi to strengthen its pools’ working capital and improve cash flow for pool partners in a volatile and high tanker rate environment.
“Tanker markets are currently experiencing volatile and high freight levels, at the same time as fuel prices are surging. This can put a strain on a tanker owner’s working capital,” says Morten Mosegaard Christensen, Chief Financial Officer at Maersk Tankers.
Shipowners who are not part of a pool are paid after completing a voyage, while having to pay their vendors on an ongoing basis. This can be financially challenging. As part of Maersk Tankers’ pools, owners receive a stable and transparent cash flow, as the company pays earnings to partners every two weeks on the basis of what has been booked in freight and demurrage.
The new credit facility will offer Maersk Tankers access to more funding ensuring a continued pay out of full earnings despite large build up in outstanding collections. It will also provide greater financial flexibility. The company will move from a quarterly to a weekly draw and repayment process, enabling it to manage cash levels in its pools more efficiently, and as a result, cut interest costs for pool partners.
“We are pleased that, together with Citi, we have created a solution, which will allow us to continue to guarantee the cash flow to our pool partners at a time where we are paying out increased TCE earnings," says Mosegaard.
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