Ship sail

Swan Hellenic gets her cruise ship back after winning shipyard auction

Swan Hellenic Cruises has managed to directly acquire a new-build expedition cruiser that Finnish shipbuilder Helsinki Shipyard put up for auction after Russian lessor GTLK defaulted on its payment obligations.

The Cyprus-based cruise operator said its bid to acquire the 10,700 gt Polar-class cruise ship SH Vega (built in 2022) had been accepted by Helsinki Shipyard after a sale to Sealed auction ended Friday at midnight.

Swan Hellenic thus becomes the second recently launched cruise operator that has financed its new buildings through rental agreements with the Russian public lessor GTLK which was able to extricate itself from the nightmarish Catch-22 situation that emerged when the Russian public lessor and its international subsidiaries were sanctioned after the invasion of Ukraine.

Swan Hellenic and Norwegian cruise ferry company Havila Kystruten found themselves with vessels deemed toxic due to their Russian ownership and immediately began taking steps to withdraw from rental agreements.

This turned out to be a complicated process due to the difficulty of transferring funds to a sanctioned entity in order to purchase the vessels.

A Norwegian court last week awarded Havila Kystruten control of the 15,500 GT cruise ferry Havila Capella (built in 2021), a decision that allowed Norwegian insurer Skuld to provide valid protection and compensation to the Norwegian operator name.

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The vessel had been stranded in port since April 12 after Gard’s national insurer dropped its cover when GTLK Asia was sanctioned.

Swan Hellenic’s first vessel, the 10,600 GT SH Minerva (built in 2021), was delivered late last year and successfully completed a cruising season in Antarctica before being laid up in Uruguay.

The company told TradeWinds in April that it exercised a purchase option under the lease agreement with GTLK, a process that began before the lessor was disciplined. The company continues to work through the lengthy process required to purchase a sanctioned asset.

Purchasing SH Vega was a much easier process for Swan Hellenic as the vessel, although completed, had not yet been handed over to the GTLK and therefore remained under the ownership of the Helsinki Shipyard.

The company told TradeWinds last week that the auction was part of a necessary process to extract the vessel from the GTLK lease agreement and that it was the preferred bidder.

Chief Executive Andrea Zito said on Monday the company was pleased to have secured the SH Vega, which he described as a “PC5 polar-class vessel with state-of-the-art technology and durability that will enter in service as planned in July.”

The ship will begin operating in the Arctic as planned from July 20.