Tufton Assets Expands Fleet with Strategic Bulk Carrier Acquisition
London-listed Tufton Assets has made a significant move in the maritime sector by agreeing to acquire two Japanese-built handysize bulk carriers for a total of $33 million. This acquisition aligns with the company’s optimistic outlook on the dry bulk market, which it recently identified as a prime area for profitable investment. The vessels, characterized as high-specification eco-design ships, are being purchased at approximately 85% of their depreciated replacement cost, highlighting Tufton’s strategic approach to capital deployment in the shipping industry.
The decision to acquire these bulkers comes shortly after Tufton Group’s quarterly update, where the company emphasized the bulker segment’s potential for strong returns. Currently, Tufton owns around 20 vessels across both the tanker and bulker markets, reflecting its commitment to investing in second-hand commercial ships. The company aims to leverage its expertise to maximize returns while adhering to environmental, social, and governance (ESG) principles.
Charter Agreements Set to Boost Returns
Upon delivery, one of the newly acquired handysize bulkers is scheduled to commence an 11- to 13-month fixed-rate charter with a prominent commodity trader. This contract is projected to yield a net return of approximately 12%. The second vessel is set for an index-linked time charter with another major commodity trader, with expectations of achieving a net yield exceeding 12%. These charter agreements underscore Tufton’s confidence in the bulker market and its ability to generate substantial income from its investments.
Tufton Assets has emphasized that these acquisitions are in line with its strategy of investing in fuel-efficient, in-demand second-hand tonnage. Both ships rank in the top quartile for fuel efficiency within their segment, aligning with the company’s focus on enhancing ESG performance while ensuring robust earnings. The board of Tufton reviewed the anticipated returns against its mid-term strategy and prospectus targets, ultimately approving the deal based on the expectation that returns will surpass the required threshold.
Strategic Vision for Future Growth
With secured charters and projected yields in the double digits, Tufton’s latest acquisition reinforces its belief that selective second-hand bulker purchases remain a compelling investment strategy. The company’s proactive approach to expanding its fleet reflects its commitment to navigating the evolving maritime landscape while capitalizing on lucrative opportunities in the dry bulk sector. As Tufton continues to grow its portfolio, its focus on fuel efficiency and ESG principles positions it well for future success in the competitive shipping market.
