Dentons Facilitates US$235 Million Ship Financing for ABGC

International law firm, Dentons has provided legal counsel to a consortium of financiers on a groundbreaking Shari’a-compliant syndicated ship financing, amounting to US$235 million, for a joint venture between Al Seer Marine and BGN, known as ABGC. This financing represents the second phase of a larger syndicated financing totaling US$370 million aimed at acquiring five dual-fuel-efficient vessels. The newly secured US$235 million tranche will facilitate the construction of an additional three cutting-edge very large gas carriers (VLGCs) in South Korea and Japan, following the successful delivery of the initial two vessels funded under the first tranche. 

The syndicate of financiers comprised Abu Dhabi Islamic Bank (ADIB), Abu Dhabi Commercial Bank (ADCB), Commercial Bank of Dubai (CBD), National Bank of Fujairah (NBF) and The Islamic Corporation for the Development of the Private Sector (ICD), a multilateral development financial institution and the private sector arm of Islamic Development Bank (IsDB). 

Nathaniel Armstrong (pictured), partner in Dentons’ Banking and Finance practice and Abu Dhabi office managing partner, who led on the transaction for the syndicate of financiers, with assistance from senior associate Shaakir Daud and associate Najeeb Gill, commented: 

“This is a landmark deal. The first tranche was the first US dollar SOFR-based Islamic construction pre-delivery ship financing, not just in the Middle East but I suspect globally too. It was particularly pleasing that the second tranche was so popular with banks across the region. This deal exemplifies precisely what sets Dentons apart from our peers in both the shipping and Islamic financing spaces. English, UAE, DIFC, Hong Kong, Korean, Marshall Islands, Cayman Islands, Japanese and Maltese law were all relevant and needed coordinating alongside our Islamic and shipping finance expertise. Noting the fuel efficiency of the vessels here, we are also delighted to have further contributed to the shipping industry’s move towards the IMO’s net zero 2050 target, which accords with our own efforts at Dentons to reduce our carbon footprint.”