AFB n RM50m chemical tanker financing

TANKER FINANCING: Onsys Energy Sdn Bhd is to invest US$92m (RM326.12m) on four chemical tankers, which cost US$23m each, its MD Jaafar Mohamad (2nd right) said at the signing ceremony between Onsys and Asian Finance Bank (AFB) Bhd for a RM50m Islamic financing facility in Kuala Lumpur yesterday. Also present at the event were (from left) AFB's CEO Datuk Mohamed Azahari Kamil and SVP & head of domestic banking Ismail Hj Aminuddin with Onsys director Alan Tan.
By T Vignesh Onsys Energy Sdn Bhd, a Malaysian-owned company with core activities in bunkering supply, oil trading, ship chartering, brokering and ownership, is to invest US$92 million (RM326.12 million) on four chemical tankers.
Managing director Jaafar Mohamad said the tankers cost US$23 million each with the first chemical tanker to arrive in November.
He said that Onsys will receive two tankers by early next year and the fourth chemical tanker is expected to reach Malaysian waters from China by March. Jaafar said that Onsys is still negotiating with a few foreign banks for the financing of the chemical tankers but for now, "the company can't say much".
"We are in talks with foreign banks as we have not received good feedback from local banks for the funding of the tankers. "The funding will be on a 50:50 basis as the other half of the funding will come from the company's internal funds," he told reporters at the signing ceremony between Onsys and Asian Finance Bank (AFB) Bhd for a RM50 million Islamic financing facility in Kuala Lumpur yesterday.
Meanwhile, the RM50 million term financing is to part finance the acquisition cost of two units of oil product tankers, Onsys Leo and Onsys Aries which sums up to US$26 million for both the tankers.
AFB's chief executive officer Datuk Mohamed Azahari Kamil said that yesterday's (Aug 17) signing ceremony marks yet another milestone for the bank as this is its first opportunity as a foreign Islamic financial institution, to part finance the acquisition of two oil product tankers. He said it is the governments vision to make Malaysia, the region's premier transhipment hub.
However, since the global economic downturn, Mohamed Azahari said the marine industry has been plagued by poor fundamentals and a lack of accessibility to funding which is necessary to develop and expand AFB's services in order to stay competitive. (The Malaysian Reserve, Aug 18, 2009, p1/7)