London: Genco Shipping & Trading has signed a definitive merger agreement to take over its subsidiary Baltic Trading, which will ultimately see Genco listing its stock on the New York Stock Exchange (NYSE).
Genco will acquire NYSE-listed Baltic Trading in a stock-for-stock transaction, after which the combined company will be owned 84.5% by Genco and 15.5% by Baltic Trading shareholders. The transaction is expected to close in the third quarter of 2015.
The combined company will operate a fleet of 70 bulk carriers, consisting of 13 capesize; eight panamax, 21 supramax, two ultramax, six handymax and 18 handysize vessels. Baltic Trading is awaiting delivery of a further two ultramaxes, which will also join the combined fleet.
“This transaction is a natural evolution for Genco and Baltic Trading,” Peter C Georgiopoulos, chairman of both companies’ boards of directors, said today. “The combined company will be poised to capitalize on opportunities in the current market environment, and we believe the combined platform is well positioned for continued growth as a consolidator in our industry.”
“Through this combination, we expect to benefit from having a larger platform and solid financial position for value creation,” added John C Wobensmith, president of Genco and president and CFO of Baltic Trading. “The transaction will simplify our ownership structure, enhance the combined company’s scale and operations and reduce overheads.”