The Panama-flagged bulk cargo vessel seized last December is owned by the United Arab Emirates, and was hijacked by the pirates on Dec. 20 some 400 miles northeast of the Seychelles.
It was not clear how the ship caught fire, or the type of cargo the vessel was carrying when it was seized. The pirates said the cargo and the ship's engines were not damaged by the fire, but the crew's living quarters were destroyed.
The pirates transferred the crew of the 27,915 dead weight tonne vessel to another seized vessel nearby.
"We did our utmost to stop the fire.. and sprayed the burning sides of the ship (with water)... but the fire didn't stop," a pirate who gave his name as Adam told Reuters.
"We have... rescued all crew members."
Somali pirates typically hijack merchant vessels, take the ships to coastal towns they control and hold them until a ransom is paid. With ransoms often in the millions of dollars, the lucrative trade has continued despite foreign naval patrols.
Abdikadir Ali, a resident and witness to the fire, said he saw a plume of black smoke billowing from the ship.