Monaco-based bulker owner Scorpio Bulkers has secured a sale and leaseback agreement for one of its Ultramaxes with an unnamed party.

Under the terms of the transaction, the company will sell the 2016-built dry bulk vessel SBI Hermes for USD 20.5 million and then lease it back from the buyer through a five-year bareboat charter agreement at a rate of USD 5,850 per day.

If converted to floating interest rates, based on the expected weighted average life of the transaction, the equivalent cost of financing at current swap rates would be LIBOR plus 1.39% per annum, Scorpio Bulkers said.

The transaction also provides the company with options to repurchase the vessel beginning on the third anniversary of the sale until the end of the bareboat charter agreement.

As informed, this transaction, which shall be treated as a financial lease for accounting purposes, increases the company’s liquidity by approximately USD 11.3 million after repayment of the vessel’s existing loan.

Built in Japan, the Liberia-flagged ship has a capacity of 77,674 cubic meters.

Scorpio Bulkers has an operating fleet of 57 vessels consisting of 56 wholly-owned or finance leased drybulk vessels and one-time chartered-in Ultramax vessel. The company's owned and finance leased fleet has a total carrying capacity of approximately 3.9 million dwt.