Press release from Ship Finance International Limited, June 1, 2015.
Ship Finance International Limited (NYSE: SFL) (“Ship Finance” or the “Company”), today announced that it has sold its holding of notes and warrants in Horizon Lines, Inc. (“Horizon Lines”) for net cash proceeds of approximately $72 million.
In April 2012, Ship Finance received $40 million of Horizon Lines second-lien notes and 9.25 million warrants in Horizon Lines in connection with a termination of the charters for 5 container vessels. Thereafter, the second-lien notes have accumulated interest on a non-cash basis at a rate of 15% annually.
In November 2014, Horizon Lines announced a merger with Matson Navigation Company, Inc. (“Matson”), subject only to regulatory approval of a sale of Horizon Lines’ Hawaii assets to The Pasha Group. On May 29, 2015, the parties announced the successful completion of the transaction, and Matson has paid $0.72 per warrant and the second-lien notes have been redeemed at a premium.
Ship Finance has conservatively recorded the notes on our balance sheet at 40% of par value, and the book gain is estimated to approximately $45 million, to be recorded in the second quarter. The cash proceeds from the notes and warrants are expected to be reinvested in new assets.
June 1, 2015
The Board of Directors
Ship Finance International Limited
Hamilton, Bermuda
About Ship Finance
Ship Finance is a major ship owning company listed on the New York Stock Exchange (NYSE: SFL). Including recent acquisitions, the Company will have a fleet of 72 vessels, including 19 crude oil tankers (VLCC and Suezmax), two chemical tankers, 22 dry bulk carriers (including 8 acquisitions), 17 container vessels, two car carriers, six offshore supply vessels, two jack-up drilling rigs and two ultra-deepwater semi-submersible drilling rigs. The fleet is one of the largest in the world and most of the vessels are employed on long-term charters.
More information can be found on the Company’s website: www.shipfinance.org
Cautionary Statement Regarding Forward Looking Statements
This press release may contain forward looking statements. These statements are based upon various assumptions, many of which are based, in turn, upon further assumptions, including Ship Finance management’s examination of historical operating trends. Although Ship Finance believes that these assumptions were reasonable when made, because assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, Ship Finance cannot give assurance that it will achieve or accomplish these expectations, beliefs or intentions.