Top Ships Shifts Focus to New Tanker Investments

Greek tanker owner Top Ships has made a strategic pivot by channeling funds from a cancelled Dubai real estate venture into constructing three new MR tankers. This decision brings the company’s total order book for this segment to ten vessels, underscoring its commitment to expanding its fleet.

Acquisition of Newbuildings

The New York-listed firm has entered into an agreement to purchase three special-purpose entities linked to a related party. Each entity holds contracts for scrubber-equipped MR product tankers, which are slated for delivery in 2029. This acquisition reinforces Top Ships’ position in the MR tanker market and demonstrates a keen interest in modern, eco-friendly maritime solutions.

The total payment for these companies is approximately $7.4 million, factoring in a $23.5 million refund from the unsuccessful Dubai real estate project. Included in this amount are reimbursements for initial payments made to the unnamed shipyard. The closing of this deal is anticipated by September 30, further solidifying Top Ships’ future growth trajectory.

Significant Revenue Potential

The newly secured vessels come with robust income potential, having locked in five-year charter agreements with a prominent oil major upon delivery. These contracts feature options that could extend the charter period by an additional year, creating avenues for revenue generation. The expected gross revenue from these contracts could reach approximately $140.6 million, which includes potential earnings from the extended charter periods.

With this latest acquisition, Top Ships now boasts a substantial potential backlog associated with its ten MR newbuildings, estimated at around $680 million. When considering the charter agreements across its entire operational fleet, as well as its proportional ownership in joint ventures, the company asserts that its total potential backlog is near $929 million.

Restructuring and Future Plans

This move follows a strategic rearrangement concerning a series of nine vessels acquired from a company linked to Evangelos Pistiolis back in February. These 47,499 dwt vessels are being constructed at Guangzhou Shipyard International and are due for delivery in 2028 and 2029. They are supported by seven-year charter agreements with Trafigura, which include potential extensions for another four years.

In a related development, this month Top Ships announced the sale of two of its newbuilding companies to its former subsidiary, Rubico, for approximately $6.25 million and $6.5 million, respectively. This transaction is poised to enhance Rubico’s own MR newbuilding portfolio to three vessels from GSI.

Currently, Top Ships operates a tanker fleet consisting of six vessels: three MR tankers, one suezmax, and two VLCCs, as well as two MR tankers owned through joint ventures. This diversified fleet positions Top Ships advantageously within the maritime industry, as it continues to focus on growth and modernization in the face of an evolving market landscape.