Farrell Sale And Leaseback Agreement Approved By MarAd
The Assistant Secretary, U.S. Department of Commerce, Maritime Administration, has approved the request by Farrell Lines Incorporated (Farrell) to enter into a sale and leaseback agreement for two containerships being built with the aid of con- struction-differential subsidy and a Title XI guarantee.
The vessels, Austral Pioneer and Austral Puritan, are presently under construction at Bethlehem Steel Corporation's Sparrows Point, Md., shipyard. They are scheduled for delivery in November 1978 and February 1979, respectively.
Under the sale and leaseback agreement, Farrell will assign its rights and obligations under the construction contracts for the vessels to the United States Trust Company of New York (Shipowner). The Shipowner will act as owner/trustee of the vessels under trust agreements, with wholly owned subsidiaries of the Bank of America National Trust and Savings Association as the equity participants.
Farrell will then bareboat charter the two container vessels under a separate 24-year charter for each of the ships. The terms of the sale and leaseback proposal are subject to approval by the Maritime Administration.