Small Malaysian tanker company Global Carriers Bhd (GCB) is shedding ships, selling its barely six year-old 12,000dwt tanker MT Budi Jasa at a steep loss for just $7.8m to LAEnergy Ltd.

GCB expects to post a MYR18.3m extraordinary loss from the transaction based on the MYR52m original price that it paid for the vessel in 2005.

"The rationale for the sale is due to the worsening downturn in the shipping industry, with rates hovering at low levels which could not
absorb the high operating costs of the vessel. The vessel has also been incurring high repair and maintenance costs," GCB said.

Of the sale proceeds, MYR3.7m will go to paying RULS instalments, MYR3m to drydocking expenses, MYR3m to service bank loans and MYR14.5m will be used for working capital.

(Source:tradewinds)