BW LPG Limited announced that its 52% subsidiary, BW LPG India, has entered into a contract for the sale of its vessel, BW Loyalty, which was built in 2008. This vessel will be sold to the buyer to continue operations, and this transaction is expected to bring significant profit to the company.
Details of the Sale of BW Loyalty
If calculated on a 100% basis, the sale of the BW Loyalty vessel is expected to generate approximately $52 million in net profit for BW LPG Limited. Additionally, the net cash proceeds from this sale, after tax and transaction costs, are estimated to be around $66 million. The BW Loyalty vessel is set to be delivered to the buyer as soon as its current lease contract is completed, and this process will be finalized by December 2026 at the latest.
Financial and Market Implications
Christian Sørensen, CEO of BW LPG, stated: "The sale of the BW Loyalty vessel at a price of around $80 million reflects the strength of the second-hand vessel market and our ability to realize value from our fleet. This transaction extracts significant value from an 18-year-old asset while simultaneously strengthening the financial position of BW LPG India." This move demonstrates BW LPG's strategy to enhance and increase the efficiency of its fleet while also capitalizing on opportunities in the second-hand vessel market.
