London-listed Tufton Assets has followed through on its bullish stance on dry bulk, agreeing to acquire two Japanese-built handysize bulkers in a $33m en-bloc deal.

The vessels, described as high-specification eco-design ships, are being bought at around 85% of depreciated replacement cost, according to the company.

The move comes just weeks after the Tufton Group-controlled fund said in its quarterly update that the bulker segment offered the strongest potential for profitable investment. The company invests in second-hand commercial vessels and currently owns around 20 ships across the tanker and bulker markets.

After delivery, one of the handysizes is set to start an 11- to 13-month fixed-rate charter with a leading commodity trader. That contract is expected to generate a net yield of about 12%.

The second vessel is lined up for an index-linked time charter with another major commodity trader. Based on the investment manager’s positive view of the bulker market, the ship is expected to deliver a net yield above 12%.

Tufton said the acquisitions fit its strategy of deploying capital into fuel-efficient, in-demand second-hand tonnage capable of producing attractive income. Both ships are ranked in the top quartile for fuel efficiency within their segment, supporting the fund’s focus on ESG performance as well as earnings.

The board said it had reviewed the expected returns against its mid-term strategy and prospectus targets and approved the deal on the basis that returns are expected to exceed the required threshold.

With charters secured and yields in double digits, Tufton’s latest purchase underlines its view that selective second-hand bulker buys remain one of the more compelling plays.