Watson Farley & Williams (WFW) advised a consortium of lenders on an ECA-backed JOLCO financing for Ocean Network Express Pte. Ltd. (ONE) to finance four newbuild container vessels.
The consortium comprised BNP PARIBAS (acting through its Tokyo Branch and as ECA Coordinator), The Hongkong and Shanghai Banking Corporation Limited, Tokyo Branch and Citibank, N.A., Tokyo Branch (as mandated lead arrangers) as well as Japanese export credit agencies Japan Bank for International Cooperation (“JBIC”) and Nippon Export and Investment Insurance (“NEXI”).
Next generation fuel ships
The four 13,700 TEU container vessels are under construction at Nihon Shipyard
The deal marks JBIC and NEXI’s first vessel-related JOLCO financing. Equity was arranged by Financial Partners Group (FPG).
The four 13,700 TEU container vessels are under construction at Nihon Shipyard and Imabari Shipbuilding in Japan and are ammonia- and methanol-ready.
They are also designed to accommodate the future installation of carbon capture devices, aligning with ONE’s commitment to introduce next generation fuel ships to its fleet.
Liner shipping companies
ONE – established in Singapore and jointly owned by Japanese shipping lines Nippon Yusen Kabushiki Kaisha, Mitsui O.S.K. Lines, Ltd., and Kawasaki Kisen Kaisha, Ltd. – is one of the world’s largest liner shipping companies, operating more than 260 vessels with a fleet capacity of approximately two million TEU.
The WFW Tokyo Assets and Structured Finance team that advised the ECAs and lenders was led by Partners Simon Collins and Shusuke Fukunaga, supported by Counsel Christian Orton and Paralegals Cameron Jeon and Saira Oshiro. WFW’s New York and Singapore offices also supported the transaction.
Carbon efficient vessels
Simon commented: “We are very pleased to have advised our valued clients on this ground-breaking deal, which marks JBIC and NEXI’s first foray into JOLCO financing in the shipping sector”.
Shusuke added: “It was gratifying to advise the Japanese ECAs and lenders on a transaction that supports both the expansion of ONE’s fleet with fuel and carbon efficient vessels as well as Japan’s market-leading Japanese shipbuilding industry and maritime cluster more broadly”.
