Global Ship Lease to Sell Baby Bond

Container ship lessor Global Ship Lease (GSL) will be selling a new Senior Unsecured Note with a maturity date in 2024.

These $25 notes will have bonuses for early redemption. They will be redeemable on and after 12/31/2021 up until 12/30/2022 for 102% plus accrued interest. Then redeemable on 12/31/2022 until 12/30/2023 for 101% plus accrued interest. Additionally they may redeem the notes anytime prior to 12/31/2021 for 104% plus accrued interest.

I do not find a current credit rating on this issue, but Standard and Poors did recently raise the companies rating on some other notes to B+.

We would expect this unsecured note issue to price fairly high–they currently have a high yield 8.75% preferred outstanding and trading around $25.15.

Remember that while this is note issue it is unsecured and with the exception of common shareholders you are kind of on the bottom rung of the capital stack.

The permanent ticker will be GSLD–there will not be OTC Grey market trading, although when the CUSIP is issused you may be able to secure shares (bonds) with a call to your broker.

The preliminary prospectus can be read here.

Thanks to mcg for being on top of this.

19 thoughts on “Global Ship Lease to Sell Baby Bond”

  1. I don’t understand why all the comments after the new GSl baby bond article have nothing to do with the product in point; even comments about the new CODI issue are here when it is in another article today. Sorry, i am confused. I would like to know what folks here have to say about GSLD. There is not one comment about it, and the comments here should be in the SANDBOX section.

    1. I own a bit of the common (GSL). I think it is a good turn-around story but it is a shipper. They are trying to retire some high-interest debt (2022 notes I believe) that they had to take on when the company was in more financial trouble. Their Preferred outstanding is pretty tiny ($35 million). Balance sheet looks good for a shipper and Container rates are pretty decent. They have a lot of their ships on decent charters so cash flow is pretty visible. Here is a good presentation to take a look at.

      https://seekingalpha.com/article/4303237-global-ship-lease-inc-2019-q3-results-earnings-call-presentation

      I’d be interested in their baby bond at the right rate.

      1. I refuse to buy any shipping common stocks due to their boom/bust cycles. I do hold several shipping preferreds ( GLOGprA, SSWprH, HMLPprA ) in my stock account. I also avoid stocks sending K-1s as it’s a taxable account and I don’t need the extra complexity.

        1. I don’t know of any shippers or their Preferreds that issue a K-1. I’m also not scared of them but I know GSL definitely does not issue a K-1.

          Shipping is not for the faint of heart, but I like to play around in the space. The majority of the shipping income issues have been very lucrative. Commons more hit or miss definitely.

      1. Tim, I just told you a week ago to set out a high sell order in case it snagged someone. If you only took my comments seriously. 🙂

        1. Yes–definitely should have done that–I always forget there is a bigger fool out there.

          1. Or someone with bigger fingers :*) It’s happened to me in the past. I managed to sell 95 for 26.51.

          2. Ha, yeah, when I saw that sale I went ahead and placed a high sell order out there, too. Just in case.

            Also, anyone know what happened with SPLP-A yesterday? 350k volume, when it is normally 20k, along with a $0.60 gain

    1. There are sharks in the waters. TIf you put out a market order on any low volume issue (LANDP has an average volume of 1,783 shares), especially at the open, you are essentially asking for trouble.

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