Company to Host Conference Call on Wednesday, August 15, 2007 at 8:30 a.m. ET
NEW YORK, Aug. 14 /PRNewswire-FirstCall/ -- Genco Shipping & Trading
Limited (NYSE: GNK) today announced that it has agreed to acquire six drybulk
vessels with an average age of approximately 2 years from affiliates of
Evalend Shipping Co. S.A. for an aggregate purchase price of approximately
$336 million. The acquisition is subject to the completion of customary
additional documentation and closing conditions. Genco plans to finance the
acquisition through borrowings under its $1.4 billion revolving credit
facility.
The six vessels, comprised of three Supramax vessels and three Handysize
vessels, are expected to be delivered to Genco during the fourth quarter of
2007. Upon completion of the acquisition, and including the nine Capesize
vessels to be acquired from companies within the Metrostar Management
Corporation group announced on July 18, 2007, Genco's fleet will consist of
nine Capesize, seven Panamax, three Supramax, seven Handymax, and eight
Handysize drybulk carriers, with a total carrying capacity of approximately
2,814,000 dwt and an average age of approximately 8 years.
Robert Gerald Buchanan, President, commented, "Once again, Genco has
capitalized on an attractive opportunity to consolidate the drybulk industry
and expand its modern, high-quality fleet. This latest acquisition further
strengthens Genco's leading industry position and increases Genco's earnings
power. We plan to continue to utilize management's expertise in taking
advantage of the strong fundamentals for drybulk shipping and to secure the
vessels in our expanded fleet on long-term time charters at favorable rates
prior to their delivery. In accomplishing this important goal, we remain
dedicated to providing leading international charterers with the highest
quality vessels that adhere to stringent operational standards."
The following table sets forth information about the six vessels to be
acquired by the Company:
Acquisition Summary
Vessel New Name DWT Built Expected Time Charter
Delivery Rate (1)
Predator Genco 55,435 2005 Q4 2007 $22,500 (2)
Predator
Innovator Genco 55,435 2005 Q4 2007 n/a
Warrior
Tomahawk Genco 57,982 Q3 2007(3) Q4 2007 n/a
Hunter
Captain Genco 28,428 2005 Q4 2007 n/a
Adams Charger
Orchid Genco 28,428 2003 Q4 2007 n/a
Bay Challenger
Stentor Genco 28,445 2006 Q4 2007 n/a
Champion
Total 254,153
(1) Time charter rate presented is the gross daily charter hire rate
before the payment of a third-party brokerage commission of 4.50%. In a time
charter, the charterer is responsible for voyage expenses such as bunkers,
port expenses, agents' fees and canal dues.
(2) The Predator, to be renamed the Genco Predator, is currently on
charter with Intermare Transport GmbH at a gross rate of $22,500 per day. The
charter is due to expire between January 2008 and March 2008. The rate is
below current market rates and therefore will result in a liability that will
amortize as an increase to revenue. See our Summary of Significant Accounting
Policies under the caption "Vessel acquisitions" in our footnotes in the June
30, 2007 Form 10-Q for disclosure of our policy.
(3) Built date for this vessel is an estimate based on guidance received
from the seller and the shipyard.
John C. Wobensmith, Chief Financial Officer, commented, "With the
acquisition of six drybulk vessels, combined with our recent agreement to
acquire nine Capesize vessels, Genco is positioned to expand its deadweight
tonnage by approximately 185% as the Company continues to establish itself as
a leading consolidator and bellwether in the drybulk industry. The acquisition
meets our strict return criteria related to earnings and cash flow accretion
as well as return on capital hurdles. In addition, we expect this transaction
to contribute to Genco's financial results in the near term, as all six
vessels are scheduled to be delivered in the fourth quarter of 2007. We plan
to finance our latest acquisition through borrowings under our $1.4 billion
revolving credit facility. In maintaining our commitment to create significant
long-term value through the successful execution of our growth strategy, we
remain focused on seeking to provide shareholders with sizeable dividends."
Conference Call Announcement
Genco Shipping & Trading Limited plans to hold a conference call on
Wednesday, August 15, 2007 at 8:30 a.m. ET to discuss the acquisition of the
six drybulk vessels. The conference call will be simultaneously webcast and
available on the Company's website, www.GencoShipping.com. To access the
conference call, dial (800) 479-9001 or (719) 457-2618 and enter the passcode
8092344. A replay of the conference call can also be accessed through August
29, 2007 by dialing (888) 203-1112 or (719) 457-0820 and entering the passcode
8092344.
About Genco Shipping & Trading Limited
Genco Shipping & Trading Limited transports iron ore, coal, grain, steel
products and other drybulk cargoes along worldwide shipping routes. Genco
Shipping & Trading Limited currently owns a fleet of 19 drybulk vessels
consisting of seven Panamax, seven Handymax and five Handysize vessels, with a
carrying capacity of approximately 988,000 dwt. After the delivery of six
vessels from affiliates of Evalend Shipping Co. S.A. and nine vessels from
companies within the Metrostar Management Corporation group, Genco Shipping &
Trading Limited will own a fleet of 34 drybulk vessels, consisting of nine
Capesize, seven Panamax, three Supramax, seven Handymax and eight Handysize
vessels, with a carrying capacity of approximately 2,814,000 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 press release are (i) execution of additional
definitive documentation for the Company's agreements to acquire the six
Evalend drybulk vessels; (ii) the fulfillment of the closing conditions under
the Company's agreements to acquire the six Evalend drybulk vessels; (iii) the
fulfillment of the closing conditions under the Company's agreement to acquire
the nine Metrostar drybulk vessels; (iv) increases in costs and expenses
including but not limited to: crew wages, insurance, provisions, repairs,
maintenance and general and administrative expenses; (v) 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, 2006, 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.
SOURCE Genco Shipping & Trading Limited
CONTACT:
John C. Wobensmith,
Chief Financial Officer,
Genco Shipping &
Trading Limited,
+1-646-443-8555
Web site: http://www.gencoshipping.com
(GNK)