According to reports from Lloyd’s List, Russia’s largest shipping company, Sovcomflot, plans to sell up to a third of its fleet in order to cover debts before sanctions take effect on May 15th.
It has been reported that at least 40 of the 121 vessels Sovcomflot directly owns are being discussed with buyers from Dubai and China.
On March 24, 2022, the United Kingdom imposed sanctions against Sovcomflot In reaction to Russia’s invasion of Ukraine. Under the conditions imposed by both the European Union and the United Kingdom governments, banks have been allowed a grace time to exit Russian contracts.
Both countries have set the 15th of May as the deadline, pushing Sovcomflot to sell a major percentage of its fleet to any interested bidder outside of the purview of international sanctions.
“All banks and charterers have until May 15 to actually terminate the contracts, which means Sovcomflot has a very short window to pay back the loans and realistically there is only one way it can do that and that is to sell the ships,” a senior banker negotiating terms with Sovcomflot told Lloyd’s List.
According to the senior official, eight of Sovcomflot’s ships have been confirmed sold, with four of them understood to have gone to Dubai-based Koban Shipping. Chinese buyers, on the other hand, are known to be taking on ships, and many agreements are said to be nearing conclusion.