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This Singapore-listed shipping trust sells container ships and will completely exit the container industry

According to Souhang.com, due to the pessimistic outlook for container transportation demand, Singaporean shipping trust company First Ship Lease Trust (FSLT) recently prepared to withdraw from the container field and sell three of its container ships.

▲FSLT sells ships to exit the container industry
The Singapore-listed shipping trust revealed that the 4,250TEU ships built in 2008, FSL Eminence (formerly YM Eminence), FSL Elixir (YM Elixir) and YM Enhancer, were sold to an independent company at an undisclosed price on August 5. The other party paid the deposit but did not disclose the price of the buyer and seller.

According to data from Vessels Value, the market value of each ship is between 7.49 and 7.85 million US dollars, which is close to its scrap price. After the sale, FSL also has a fleet of 12 tankers.

In explaining the move, Markus Wenker, Chief Financial Officer of FSL Trust, said: “Two of the container ships have completed charter contracts, and the third container ship is about to complete charter contracts in October.”

Wenker believes that since the outbreak of Covid-19, the container shipping market has undergone tremendous changes and the market has not entered the framework of normalization.

Wenker said: "It is difficult to predict how the Covid-19 epidemic will evolve."

The CFO added that after considering all available options, the company believes that the best solution for FSL Trust is to “sell container ships”.

FSL Trust added that under the current market environment, the company currently has no plans to acquire more modern container ships because it has not signed long-term leases with counterparties with strong financial resources, but it is still participating in the tanker market.

Wenker added that FSL Trust has no plans to re-enter the container field, but if a situation arises, including a long-term container ship lease project, the company will seriously consider the project.

The three 4,250 teu ships built in 2008 were all leased to Taiwan’s Yangming Shipping. On May 20 and June 16, FSL Eminence and FSL Elixir were re-delivered to FSL Trust by the lessee Yang Ming, and the lease of YM Enhancer is until October 2020, and then it is expected to be delivered to the buyer.