GOGL: Purchase Option Declaration

Rhea-AI Summary

Golden Ocean Group (NASDAQ/OSE: GOGL) has announced the declaration of purchase options for eight Capesize vessels currently under long-term charter-in agreements with SFL subsidiaries. The total purchase price is set at $112 million en-bloc, with the options being exercised at the 10-year anniversary of the charter agreements.

The acquisition will be financed through a combination of a new $90 million revolving credit facility and cash on hand. The transaction is expected to complete during Q3 2025, subject to standard documentation and closing procedures.

Positive

• Acquisition of 8 Capesize vessels strengthens owned fleet
• 90% of purchase price secured through credit facility
• Strategic fleet ownership transition from charter-in to owned vessels

Negative

• Significant cash outlay of $112 million required for vessel purchase
• Additional debt burden through $90 million credit facility
• Increased exposure to vessel value fluctuations

Insights

Maritime Financial Analyst

This strategic acquisition represents a significant shift in Golden Ocean's fleet management approach, converting eight chartered Capesize vessels into owned assets at an attractive price point of $14 million per vessel. The timing of this purchase option exercise, coinciding with the 10-year charter anniversary, demonstrates careful long-term planning in fleet optimization.

The financing structure, combining a $90 million revolving credit facility with cash reserves, indicates strong financial management. The revolving nature of the facility provides additional flexibility for future fleet expansion or refinancing opportunities. The $22 million cash component suggests prudent use of balance sheet resources without overextending the company's liquidity position.

From an operational perspective, transitioning from chartered to owned vessels typically reduces daily running costs and provides greater operational flexibility. This move could potentially generate substantial savings in daily vessel expenses, as ownership eliminates charter payments while retaining the vessels' earning potential. The transaction also strengthens GOGL's asset base, enhancing its position in the Capesize segment where scale and operational efficiency are important competitive advantages.

The Q3 2025 completion timeline allows for proper integration planning and coincides with a period when seasonal demand for dry bulk shipping typically strengthens. This acquisition will expand GOGL's owned fleet, potentially improving the company's market position and operational leverage in the Capesize segment, which primarily serves iron ore and coal transportation routes.

Golden Ocean Group Limited (NASDAQ/OSE: GOGL) (the “Company”) announces that it has declared the purchase options for eight Capesize vessels under the long-term charter-in agreements with subsidiaries of SFL Corporation Ltd. The total purchase price is $112 million en-bloc, and the options have been declared in connection with the 10-year anniversary of the charter-in agreements. The acquisition will be financed through a new $90 million revolving credit facility subject to customary documentation and closing procedures, and cash on hand. It is expected that the acquisition will be completed during Q3 2025. 

February 12, 2025
Hamilton, Bermuda

For more info please contact:

Peder Simonsen, Interim Chief Executive Officer and Chief Financial Officer of Golden Ocean Management AS.

Telephone +47 23 11 40 00

Forward-looking statements: This release may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the Company’s current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.

 

FAQ

How many Capesize vessels is GOGL purchasing from SFL ?

Golden Ocean Group (GOGL) is purchasing eight Capesize vessels from SFL subsidiaries.

What is the total purchase price for GOGL's vessel acquisition?

The total purchase price for the eight vessels is $112 million en-bloc.

How is GOGL financing the $112 million vessel purchase?

GOGL is financing the purchase through a new $90 million revolving credit facility and cash on hand.

When will GOGL complete the acquisition of the eight Capesize vessels?

The acquisition is expected to be completed during Q3 2025.

What is the size of the new credit facility GOGL is securing for the vessel purchase?

GOGL is securing a new $90 million revolving credit facility for the vessel purchase.