Global seaborne shipping and logistics company Navios Maritime Holdings Inc. has reached an agreement to acquire four Capesize vessels, three of which are from companies controlled by Commerzbank A.G.
All of the vessels are currently under construction at the same South Korean Shipyard.
Navios Holdings also announced that it amended the terms of existing agreements for three new build Capesize vessels which are scheduled for delivery in the fourth quarter of 2009.
Navios Holdings will fund a portion of the purchase price for all seven vessels by issuing $165.22M in mandatorily convertible preferred stock.
"The new acquisitions demonstrate our ability to grow our fleet and cash flow by taking advantage of market dislocations," said Angeliki Frangou, chairman and CEO of Navios Holdings. "Today's agreement to acquire four vessels will generate approximately $43.33M of EBITDA annually. These acquisitions also demonstrate the vitality of Navios' business as various industry participants have found our equity attractive."
"Using mandatorily convertible preferred stock to fund cash requirements strengthens our balance sheet, as we conserve more than $165.22M of cash."
The aggregate purchase price for the four new vessels will be approximately $324.50M payable with a combination of cash and mandatorily convertible preferred stock.
The vessels will be employed under existing long-term charter-out contracts with an average length of 9.75 years and will generate approximately $43.33M in annual EBITDA (assuming operating expense of $5,000 per day and 360 revenue days per year).
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