Greek Shipping News Cuts
Week 30 - 2011
New York hedge fund Rima Management has built up a 5.47% stake in the Dimitris Melissanidis / Peter Georgiopoulos-linked Aegean Marine Petroleum, according to a Security and Exchange Commission (SEC) filing. Its holding of 2.56m shares in the bunker supplier is worth around $15m and has been accumulated over a period of time, though Rima is not a heavy investor in shipping.
US-listed Navios Maritime Partners and Capital Product Partners have announced second quarter dividends. The Angeliki Frangou-led Navios has lifted its cash distribution by 2.3% to $0.44 per unit for the quarter ended June 30, 2011 representing an annualised distribution of $1.76 per unit, while Capital Partners, operator of 21 tankers and a bulk carrier has declared a quarterly dividend of $0.2325 a share.
The deal was reached through close cooperation between Marorka and its Greek representative Daniel Marine Consultants, headed up by Nikos Daniel.
Navios Maritime is said to have arrested a Cosco Group bulker carrier in Australia. Navios ceo Angeliki Frangou revealed July 27 the company was owed $5.1m for 45 days' hire on three vessels by "a major counterparty that is connected with a government entity". As reported in Vol 12 Nr 29 of Newsfront, George Economou is chasing Cosco Qingdao through London arbirtation over claimed unpaid hire by the Cosco affiliate. Economou arrested the 174,700dwt Tian Baho Hai in Singapore and has threatened to move against other vessels. Cosco maintains the freights have been paid "according to Chinese law". The issue seems to revolve around unpaid tax.
Greek secondhand buys rise
---GREEK secondhand purchases rose 30% in the second quarter from first-quarter levels, Fairplay was told today.
This "positive buying momentum" for drybulkers is likely to continue, she predicted, as Greek owners wait for asset prices to drop over this summer before committing to new deals.
Secondhand purchases by Greek owners in the first half of this year were down 49% compared to 1H10, but Bertzeletou stressed: "Greek owners are still outpacing Chinese players, as they are buying more tankers than their rivals."
Source: Fairplay Daily News 25 Jul 2011
Greek owner on handysize track
---A switch in fleet focus from geared panamaxes has been achieved in under four years.
Greek shipowner Tsangaris Bros has recently taken delivery of its first bulker newbuilding in an ongoing fleet revamp that has been several years in the making.
The 32,500-dwt handysize Tampta was delivered from Zhengjiang Hongxin Shipbuilding in China almost 10 years after the company first saw the signs that it needed to change its profile.
It joins three sisterships already in the fleet.
In just under four years, the owner has switched from being a geared-panamax specialist to handysizes.
Company director Michalis Tsangaris, who represents the second generation of the family shipping business, says it has swapped one niche for another.
Back in 2005, when the entire segment consisted of just over 60 ships, Tsangaris Bros operated seven geared panamaxes in total. They were used to transport cargoes to ports with no loading or discharging facilities, mostly in Southeast Asia.
The market was supported by another 100 or so grab-fitted handymaxes, so the global fleet of self-loaders was relatively small, Tsangaris says.
But the market had already begun to change with the arrival of the first supramaxes n 2002. Being just 10,000 dwt smaller than a panamax and also equipped with grabs, they in effect diluted the niche Tsangaris Bros knew so well.
Tsangaris Bros soon began disposing of its geared bulkers, while in 2007 it paid a reported $75m en bloc for the 27,800-dwt Eleni T and Niki T and 28,500-dwt Captain T (all built 1997).
The price was considered low at the time but this was mainly due to the inclusion of three-year time charters back to seller Pacific Basin at $16,000 per day. The charter rate was also on the low side at the time, as against shorter periods yielding around $30,000 per day.
But Tsangaris says the company saw the financial benefits of the package, as the capital outlay was lower than what it would have paid for charter-free ships.
All four handysizes are currently working in the spot market where rates are around $12,000 per day, according to brokers.
On the newbuilding front, it has not been plain sailing. The company contracted one handysize at Jinse Shipbuilding of South Korea in 2008 but it was cancelled and the deposit returned after the yard went bust. A second contract at a compatriot Korean yard was also ditched after it failed to secure refund guarantees.
The company signed up for the Tampta in September 2010 for a reported $25m.
Meanwhile, Tsangaris describes his company as a small outfit that prefers to make one move at a time.
It is considering more newbuildings to reach its ideal operating capacity of around 10 ships but no plans have yet been firmed up.
By Yiota Gousas Athens
Published: 22:01 GMT, 28 Jul 11 | updated: 20:16 GMT, 27 Jul 11
DryShips Inc. And Oceanfreight Inc. Announce Merger Agreement
OceanFreight Inc. (NASDAQ: OCNF) announced today that the companies have entered into
a definitive agreement for DryShips to acquire the outstanding shares of OceanFreight for
consideration per share of $19.85, consisting of $11.25 in cash and 0.52326 of a share of
common stock of Ocean Rig UDW Inc., a global provider of offshore ultra deepwater drilling
services that is 78% owned by DryShips. The Ocean Rig shares that will be received by the
OceanFreight shareholders will be from currently outstanding shares held by DryShips.
Under the terms of the transaction, the Ocean Rig shares will be listed on the Nasdaq Global
Select Market upon the closing of the merger.
Based on the July 25, 2011 closing price of 89.00 NOK ($16.44) for the shares of
Ocean Rig on the Norwegian OTC, the transaction consideration reflects a total equity value
for OceanFreight of approximately $118 million and a total enterprise value of approximately
$239 million, including the assumption of debt.
The transaction has been approved by the Boards of Directors of DryShips and
OceanFreight, by the Audit Committee of the Board of Directors of DryShips, which
negotiated the proposed transaction on behalf of DryShips, and by a Special Committee of
independent directors of OceanFreight established to negotiate the proposed transaction on
behalf of OceanFreight.
The transaction will allow DryShips to acquire high-quality, modern drybulk vessels
with attractive long-term charters. OceanFreight owns a fleet of six vessels, including four
Capesize and two Panamax vessels with a weighted average age of six years and combined
deadweight tonnage of 859,622 tons and has contracted to purchase five newbuilding Very
Large Ore Carriers (VLOC) with a combined deadweight tonnage of approximately one
million tons scheduled to be delivered in 2012 and 2013. DryShips will also benefit by
aggregate principal amount of $142.8 million, bear interest at Libor plus 250 basis points and
have a final maturity of October 2015.
George Economou, Chairman and CEO of DryShips, commented:
transaction provides DryShips with a unique opportunity to consolidate the fragmented
drybulk sector by acquiring a high quality, modern fleet with long-term charters to solid
charterers. As previously announced, we have a fleet renewal plan that is being implemented
by selling our older vessels. Given current freight market conditions, our preference is to
acquire younger vessels with medium to long-term charters with moderate financing in place.
The merger with OceanFreight offers us a unique opportunity to renew DryShips fleet,
increase our presence in the Capesize/VLOC sector and augment our fixed revenues, and to
do so at a low point in the cycle at what we consider to be an attractive valuation. We will
achieve this through minimal use of cash and no issuance of additional DryShips equity while
utilizing a mere 2.3% of our ownership stake in Ocean Rig in a manner that will also increase
its public float. We will continue to monitor developments in the shipping industry
selectively as the weak freight market may offer us further strategic acquisition opportunities.
This merger is a testament to the strong position of DryShips and our belief in the long-term
prospects of the drybulk freight market. Pro forma for the merger, Dryships will own a fleet
Professor John Liveris, Chairman of the Board of Directors and Special Committee of
employment profile that our management team implemented over the past two years. This
value unfortunately was not reflected in our stock trading price. Additionally, we are pleased
to provide our shareholders with the opportunity to participate in Ocean Rig, a growing
The public shareholders of OceanFreight will receive the consideration for their
shares pursuant to a merger of OceanFreight with a subsidiary of DryShips. The completion
of the merger is subject to customary conditions, including clearance by the U.S. Securities
and Exchange Commission of a registration statement to be filed by Ocean Rig to register the
shares being paid by DryShips in the merger and the listing of those shares on the Nasdaq
Global Select Market. The cash portion of the consideration is to be financed from DryShips'
existing cash resources and is not subject to any financing contingency. The merger is
expected to close in the fourth quarter of 2011.
Simultaneously with the execution of the definitive merger agreement, DryShips,
entities controlled by Mr. Anthony Kandylidis and OceanFreight, entered into a separate
purchase agreement. Under this agreement, DryShips will acquire from the entities
controlled by Mr. Kandylidis all their OceanFreight shares, representing a majority of the
outstanding shares of OceanFreight, for the same consideration per share that the
OceanFreight stockholders will receive in the merger. This acquisition is scheduled to close
four weeks from the execution of the merger agreement, subject to satisfaction of certain
conditions. DryShips intends to vote the OceanFreight shares so acquired in favor of the
merger, which requires approval by a majority vote. The Ocean Rig shares to be paid by
DryShips to the entities controlled by Mr. Kandylidis will be subject to a 6-month lock-up.
Evercore Partners is serving as financial advisors to DryShips in connection with the
transaction and Fried, Frank, Harris, Shriver & Jacobson LLP is serving as DryShips' legal
counsel. Fearnley Fonds ASA is serving as financial advisors to the Special Committee of
Danaos Corporation appoints Evangelos Chatzis as Chief Financial Officer
---Athens, Greece, July 25, 2011 - Danaos Corporation (NYSE: DAC), a leading international owner of containerships, announced that the Board of Directors of the Company has appointed Mr. Evangelos Chatzis to the position of Chief Financial Officer, effective July 22, 2011.
Evangelos Chatzis has over 16 years of experience in corporate finance and the shipping industry and has been with Danaos since early 2005 where he has served as Treasurer and Deputy Chief Financial Officer. During his years with Danaos he has been actively engaged in the company's financial management, the company's initial public offering in the United States, and has led a variety of projects, the latest being the successfully concluded comprehensive financing plan of the company. Throughout his career he has developed considerable experience in operations, corporate finance, treasury and risk management and international business structuring.
Prior to joining Danaos, Evangelos was the Chief Financial Officer of Globe Group of Companies, a public company in Greece engaged in a diverse scope of activities including dry bulk shipping, the textile industry, food production & distribution and real estate. During his years with Globe Group, he was involved in mergers and acquisitions, corporate restructurings and privatizations.
He holds a Bachelor of Science degree in Economics from the London School of Economics, a Master's of Science degree in Shipping & Finance from City University Cass Business School, as well as a post-graduate diploma in Shipping Risk Management from IMD Business School.
Dr. John Coustas, President & Chief Executive Officer of Danaos commented: "We are pleased to announce the appointment of Evangelos as the new Chief Financial Officer of the company. Evangelos has been a valuable and trusted member of the management team for almost 7 years and brings solid experience and continuity to the post, having been actively involved in the company's initial public offering and its transformation and growth since then. We look forward to his contribution towards further solidifying the company's future and wish him every success in his new duties."
Costamare Inc. Reports Second Quarter 2011 Results
Voyage revenues of $94.3 million and $180.3 million for the three and the six months ended June 30, 2011, respectively.
Voyage revenues adjusted on a cash basis of $101.8 million and $195.7 million for the three and the six months ended June 30, 2011, respectively.
Adjusted EBITDA of $65.8 million and $127.1 million for the three and the six months ended June 30, 2011, respectively.
Net income of $26.2 million or $0.43 per share and $44.1 million or $0.73 per share for the three and the six months ended June 30, 2011, respectively.
Adjusted Net Income of $26.9 million or $0.45 per share and $49.3 million or $0.82 per share for the three and six months ended June 30, 2011, respectively.
New Business Developments
The Company has agreed to purchase the 5,060 TEU capacity, 2003-built container vessel MSC Linzie (to be renamed MSC Romanos) from an unaffiliated third party. The acquisition cost will be $55.0 million and the vessel is expected to be delivered to the Company between August 15 and September 30, 2011.
Entered into the following chartering agreements:
The time charter agreement with MSC for the 1988-built, 4,828 TEU c/v MSC Mykonos, has been extended as from July 14, 2011 until September 1, 2017, at a daily rate of $20,000.
The time charter agreement with MSC for the 1988-built, 4,828 TEU c/v MSC Mandraki, will be extended from November 2, 2011 until July 1, 2017, at a daily rate of $20,000.
The time charter agreement with Hapag-Lloyd for the 1987-built, 3,152 TEU c/v Akritas, will be extended from September 30, 2011 for 36 months, at a daily rate of $12,500.
On July 3, 2011, the 1990-built, 3,351 TEU c/v Rena, commenced a five-year time charter agreement with MSC at a daily rate of $15,000.
On July 19, 2011, the 1995-built, 1,162 TEU c/v Zagora commenced an eight month time charter agreement with MSC at a daily rate of $7,000.
Obtained a firm offer, subject to documentation but not subject to further credit approval, from a consortium of major European and US financial institutions for the financing arrangements for three out of the five newbuilding contracts entered into with Sungdong Shipbuilding & Marine Engineering Co., Ltd. in April 2011. Received indications of interest and is in advanced discussions with major financial institutions regarding the financing of the remaining two newbuilds.
On July 11, 2011, the Board of Directors declared a dividend for the second quarter ended June 30, 2011, of $0.25 per share, payable on August 9, 2011 to stockholders of record at the close of trading of the Company's common stock on the New York Stock Exchange (the NYSE) on July 27, 2011. This was the third cash dividend we have declared since our initial public offering on November 4, 2010.
Management of the Company also announced that it will recommend to the Board of Directors that the Board approve an eight percent (8%) dividend increase, beginning with the third quarter 2011 dividend, raising the quarterly dividend from $0.25 to $0.27 per common share.
Mr. Gregory Zikos, CFO of Costamare Inc., commented:
TEN follows the downward trend
---(July 29 2011) Tsakos Energy Navigation (TEN) experienced a net loss of $18.1 mill for 2Q11.
This was despite voyage revenues of $101.3 mill.
During the period the average total fleet TCE per vessel was $16,426, while operating costs were $7,826 per day across the fleet.
For the first half of the year, TEN reported a net loss of $8.8 mill on voyage revenues of $200.5 mill.
The average TCE per day per vessel was $17,203 while operating costs averaged $7,654 per day per vessel during 1H11.