Brightoil buys

Brightoil Petroleum of Hong Kong is spending $18m to make good on a promise to expand a fleet of ships that supports its marine fuel division.
In addition to bunker barges and small product tankers Brightoil, which is led by Sit Kwong Lam, owns VLCCs and aframaxes.

In addition to bunker barges and small product tankers Brightoil, which is led by Sit Kwong Lam, owns VLCCs and aframaxes.

In a regulatory filing the company said it is planning to acquire a pair of bunker barges that are under construction at Haidong Shipyard in China but due for delivery in early September.

Brightoil didn’t shed light on the size or technical specifications of the units but pointed out that the sellers are controlled by affiliates of chairman Sit Kwong Lam.

It also noted the $18m price tag tied to the deal represents a discount of roughly $2m as it believes the duo would likely command $10m a piece in the sale-and-purchase market.

Brightoil told investors that it intends to finance the transaction with a combination of cash and bank debt but failed to mention whether management has already lined up a loan.

The company argued that the acquisitions will “enhance the competitive strength” of the group’s bunkering business by expanding its operating fleet, which should, in turn, increase earnings power.

Brightoil, which boasts its own fleet of crude and product tankers but is also an active charterer, said it is confident that the new bunker barges will aid ongoing efforts to lift marine bunker sales volumes.

Brightoil is based in Hong Kong but its network includes outposts in Singapore, Houston, Geneva, Rotterdam, Athens, Tokyo, Seoul, Malaysia and several cities in China. Its shares are listed on the Hong Kong Exchange.

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