Genco Shipping & Trading Limited has agreed to cancel the previously announced acquisition of six drybulk newbuildings from Lambert Navigation Ltd., Northville Navigation Ltd., Providence Navigation Ltd., and Prime Bulk Navigation Ltd., with an aggregate purchase price of $530M.
As part of the agreement, the selling group will retain the deposits totaling $53M for the six vessels, comprised of three Capesize and three Handysize vessels.
John C. Wobensmith, chief financial officer, commented, "While Genco was prepared to take delivery of the six drybulk newbuildings that we agreed to acquire in June 2008, management has made a proactive decision to forego the vessels, which we believe provides important benefits. Specifically, the Company's liquidity has been strengthened during a difficult market environment and our ability to act opportunistically has been enhanced.
"By taking advantage of the Company's increased financial flexibility, combined with our significant time charter coverage of approximately 93% for our fleet's available days for the remainder of 2008 and 67% in 2009, we remain well positioned to continue to serve the best interests of our shareholders as we have consistently done since our IPO in July 2005."
Genco has four remaining Capesize newbuildings scheduled to be delivered in 2009. The company says that it intends to utilise the undrawn portion of its credit facilities as well as cash flow from operations to fund these acquisitions.
Genco Shipping & Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes.
After the expected delivery of four vessels it has agreed to acquire, Genco Shipping & Trading Limited will own a fleet of 35 drybulk vessels, consisting of nine Capesize, eight Panamax, four Supramax, six Handymax and eight Handysize vessels, with an aggregate carrying capacity of approximately 2,909,000 dwt.
