CIC participates in $600m commitment to Diamond S Shipping
China Investment Corp. (CIC) is part of a group that has agreed to invest more than $600 million in Diamond S Shipping, enabling the energy-focused transportation company to buy 30 medium-range vessels and related charters. Diamond S already has a fleet of 10 tankers under construction in Korean shipyards.
CIC's fellow investors include First Reserve Corp., WL Ross & Co., Fairfax Financial Holdings, Morgan Creek Capital Management and PPM America Capital Partners. Together they will fund a portion of Diamond S' acquisition, with the balance to be covered by debt financing from Nordea Bank Finland and DnB Nor Bank ASA.
Funding for the 10 tankers, constructed by Hyundai Heavy Industries and Samsung Heavy Industries, has already been secured. First delivery is scheduled for January 2012.
The 30 vessels and related charters are being purchased from Cido Tanker Holding. The transaction is structured as the purchase of stock in companies that own the target assets, which makes it easier to deal with existing charters, third-party management contracts, flags and ship classifications.
Diamond S was advised by Jones Day, while Cido was represented by Mayer Brown JSM.
CIC last month announced an 11.7% return on its offshore investments in 2010. Its exposure to alternative investments - such as private equity, hedge funds, real estate and infrastructure - increased sharply to 21% from 6% in 2009.
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