Saudi logistics firm secures loan to expand fleet

11 January 2018
Loan to finance four vessels that Bahri Dry Bulk had previously agreed to acquire from South Korean shipbuilder

Bahri Dry Bulk, a subsidiary of Riyadh-based National Shipping of Saudi Arabia (Bahri), has secured a SR360m ($96m) loan from local Bank Albilad to finance the purchase of four new bulk carriers.

Acquiring the four vessels is part of an agreement Bahri signed with South Korea’s Hyundai Mipo Dockyard (HMD) last year.

The loan will be used to finance 80 per cent of the cost of the four vessels, which will take the firm’s bulk carrier fleet to nine.

According to Bahri, the sharia-compliant credit facility will be paid over six months and has a tenure of 13 years including a three-year grace period.

“The company has provided all the necessary guarantees for obtaining the loan, including a pledge of the four carriers upon delivery from the shipbuilding yard,” the company said in a statement.

Ali al-Harbi, CFO of Bahri, said the four vessels will cater to the growing demand for the import of essential grains into Saudi Arabia,

Established in 2010, Bahri Dry Bulk is a 60:40 joint venture between Bahri and Arabian Agricultural Services Company (Arasco). It focuses on the transportation of grain, coal and other dry bulk cargoes.

Last year, Bahri formed a 60:40 joint venture with the logistics arm of France’s Group Bollore called Bahri Bollore Logistics.

The joint venture is expected to help Bahri roll out an end-to-end logistics services internationally, in addition to its transport and shipping business in the region, and provide Bollore access to the domestic and regional logistics market.

 

 

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