Chilean shipping firm Compania Sud American de Vapores announced the completion of an agreement with a consortium of financial institutions for the issuance of a USD347 million loan package. The proceeds would be used to pay for seven new ships to expand the fleet of Vapores.

Vapores is one of the oldest shipping lines in the world. Under the financing plan, it would be paying for the purchase of the new ships through bank loans and part of the proceeds of its recent equity financing activity. 

The banks included in the deal are the Export-Import Bank of Korea, Banco Santander-Chile, Citibank NA, Deutsche Bank AG, the Korea Exchange Bank and the Korea Development Bank. 

The recent years saw Vapores suffer losses because of lowered shipping rates, high operational costs and expensive leases. To boost the company's fleet as well as repay debt and implement development strategies, the company instituted a share offer projected to net USD500 million. Unfortunately, the company's depreciating price share and weakening Chilean currency did not help achieve the projected amount. 

One of the few bright spots is the purchse by the Luksic family, one of the Chile's richest, gaining majority shareholdings in the company through a USD1.2 billion capital infusion back in 2012. To keep the ship afloat, it spun off its storage logistics unit to limit losses for the firm overall.