DryShips Inc. (NASDAQ:DRYS)
DryShips Inc. (NASDAQ:DRYS) announced the delivery of a 159,855 deadweight ton Suezmax tanker. DryShips Inc. (NASDAQ:DRYS) expects a gross backlog of $25,000 per day and $43.1 million for the 5 years. The vessel was bought from and chartered out to companies connected to Mr. George Economou, DryShips’s Chairman and Chief Executive Officer. The whole transaction had the approval of the audit committee appointed by the company’s Board of Directors.
In other news, DryShips Inc. (NASDAQ:DRYS) announced securing a credit facility amounting to $150 million with KEXIM and ABN AMRO bank. The credit facility will go towards financing the delivery of the company’s four Very Large Gas Carriers (VLGC). The credit facility will be secured by the four VLGCs and an amortization profile of around 12 years. The facility will have an interest rate of LIBOR+.
The high specification VLGCs, still under construction at Hyundai Heavy Industries, will be delivered in June, September, October and December of this year and will be used for long term charters to leading oil companies. The four VLGCs will have a gross backlog of around $390 million.
While commenting on the transaction, Economou said the company has come a long way in negotiating the deal which started last year. He added that negotiations started with the company requesting lenders to restructure its debts. He applauded KEXIM and ABN AMRO for their support and helping arrange the company’s first bank credit facility since 2014.
Economou added that following the complete servicing of the new loan, DryShips Inc. (NASDAQ:DRYS) will have many of its vessels unencumbered. He added that in financial terms, the assets will be able to raise around $250 million or $19.13 per share subject to maintaining a modest 50% market value. He added that they will be working on securing financing for these assets. This will enable the company to rally its efforts and resources towards acquisition of more vessels without the need to raise more equity.
DryShips Inc. (NASDAQ:DRYS) lost 3.89% in the previous trading session to close at $2.72 on a volume of 3.62 million shares.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.