NEW YORK, NY, Jul 12, 2006 (MARKET WIRE via COMTEX News Network) -- Genco Shipping & Trading Limited (NASDAQ: GSTL) today announced that
the Company has agreed to acquire three drybulk vessels from
affiliates of Franco Compania Naviera S.A., for an aggregate purchase
price of $81.25 million. The acquisition is subject to customary
closing conditions and the vessels are expected to be delivered
between August and November of 2006.
Genco is to finance the acquisition of the three vessels through
borrowings on its $550 million revolving credit facility. The three
vessels to be acquired are: the Anita, a 1999 Japanese-built Panamax
vessel to be renamed the Genco Acheron; the Koby, a 1998
Japanese-built Panamax vessel to be renamed the Genco Surprise; and
the Paige, a 1994 Japanese-built Handymax vessel to be renamed the
Genco Commander. With the addition of the three vessels, Genco's
fleet will consist of seven Panamax, eight Handymax, and five
Handysize drybulk carriers, with a total carrying capacity of
approximately 1,029,000 dwt and an average age of nine years.
Robert Gerald Buchanan, President, commented, "Since Genco's
inception, a core strategic focus has been to acquire vessels that
surpass rigorous standards as well as enhance the Company's earnings
potential. With this acquisition of three high quality vessels,
Genco has once again seized an opportunity to execute on this goal as
it grows its fleet by 23 percent on a tonnage basis. This transaction
also positions the Company to expand its leadership in the drybulk
industry and continue to take advantage of favorable long-term
industry fundamentals. Genco remains committed to utilizing its
modern vessels to meet the commodity transportation needs of leading
global charterers."
John C. Wobensmith, Chief Financial Officer, commented, "We are
pleased to draw upon our significant financial flexibility and
continue to consolidate the drybulk industry without having to issue
additional equity. As with previous acquisitions, we have adhered to
strict criteria focused on providing earnings and cash flow accretion
as well as maintaining a keen concentration on return on capital.
Cost effective operations will remain a priority for Genco and we
expect our established platform to easily absorb these newly acquired
vessels. We intend to continue to actively pursue future acquisition
opportunities in order to further create long-term value for the
Company and its shareholders. With total pro forma liquidity of
approximately $378 million combined with our pro forma net
debt-to-capital ratio of 33.7% as of March 31, 2006, assuming the
delivery of the three vessels and the use of $81.25 million of our
undrawn credit facilities to purchase them, we are in a strong
position to continue to grow the Company while providing shareholders
the opportunity to receive sizeable dividends."
About Genco Shipping & Trading Limited
Genco Shipping & Trading Limited transports iron ore, coal, grain,
steel products and other drybulk cargoes along worldwide shipping
routes. After the acquisition of the three vessels, Genco Shipping &
Trading Limited will own a fleet of 20 drybulk vessels, consisting of
seven Panamax, eight Handymax and five Handysize vessels, with a
carrying capacity of approximately 1,029,000 dwt.
"Safe Harbor" Statement Under the Private Securities Litigation
Reform Act of 1995
This press release contains forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are based on
management's current expectations and observations. Included among
the factors that, in our view, could cause actual results to differ
materially from the forward-looking statements contained in this
report are (i) the fulfillment of the closing conditions under the
Company's agreement to acquire the three drybulk vessels; (ii)
increases in costs and expenses including but not limited to: crew
wages, insurance, provisions, repairs, maintenance and general and
administrative expenses; (iii) changes in the condition of the
Company's vessels or applicable maintenance or regulatory standards
(which may affect, among other things, our anticipated drydocking or
maintenance and repair costs) and unanticipated drydock expenditures;
and other factors listed from time to time in our public filings with
the Securities and Exchange Commission including, without limitation,
our Annual Report on Form 10-K for the year ended December 31, 2005,
our Quarterly Reports on Form 10-Q, and our reports on Form 8-K.
Our ability to pay dividends in any period will depend upon factors
including the limitations under our loan agreements, applicable
provisions of Marshall Islands law and the final determination by the
Board of Directors each quarter after its review of our financial
performance. The timing and amount of dividends, if any, could also
be affected by factors affecting cash flows, results of operations,
required capital expenditures, or reserves. As a result, the amount of
dividends actually paid may vary. For further details of the
calculation of the pro forma figures used above, please refer to the
Company's earnings conference call presentation for the first quarter
of 2006, available on the Company's web site at
http://www.gencoshipping.com.
CONTACT:
John C. Wobensmith
Chief Financial Officer
Genco Shipping & Trading Limited
(646) 443-8555
SOURCE: Genco Shipping & Trading Limited