KNOT Offshore completes ‘Hilda Knutsen’ and ‘Torill Knutsen’ acquisition

KNOT Offshore Partners LP has announced that it has completed its acquisition of all the ownership interests in the companies that own and operate the shuttle tankers Hilda Knutsen and Torill Knutsen.

The purchase price of the Hilda Knutsen was $166.0 million, net of $109.6 million of outstanding indebtedness related to the vessel, subject to post-closing adjustments. The purchase price of the Torill Knutsen was $169.0 million, net of $112.1 million of outstanding indebtedness related to the vessel, subject to post-closing adjustments. The cash portion of the purchase prices was financed with proceeds from the Partnership’s public offering of 4,600,000 common units which closed on June 27, 2014.

Related: KNOT Offshore buys two shuttle tankers

Both Hilda Knutsen and the Torill Knutsen are operating in the North Sea under time charters (the “Hilda Charter” and the “Torill Charter,” together, the “Hilda and Torill Charters”) with Eni Trading & Shipping S.p.A. The Hilda and Torill Charters started upon delivery of the Hilda Knutsen and the Torill Knutsen in the third quarter of 2013 and each will terminate five years after delivery. Eni has options to extend each of the charters for up to five one-year periods. In the case of the Torill Charter, Eni has the option, at any time before May 31, 2016, to extend the charter term to ten years in exchange for a reduction in the hire rate.

The Partnership owns, operates and acquires shuttle tankers under long-term charters in the offshore oil production regions of the North Sea and Brazil. The Partnership is structured as a master limited partnership. The Partnership’s common units trade on the New York Stock Exchange under the symbol “KNOP.”