London: Knightsbridge Shipping has completed its acquisition of 12 capesize bulk carrier newbuildings from fellow Fredriksen-Group company Frontline 2012.
Knightsbridge has issued a second tranche of 31.1m shares to Frontline 2012 in exchange for the new vessels, having already transferred 31.1m shares on September 16 last year.
“Following this transaction, Knightsbridge will have 111.1m common shares outstanding,” the company said in a statement today.
Completion of the deal makes Knightsbridge owned 70% by Frontline 2012 and owned 3% by John Fredriksen’s private investment firm Hemen Holdings.
Knightsbridge is due to merge at the end of March with Golden Ocean, another Fredriksen-Group bulker operator.
NASDAQ-listed Knightsbridge’s share price has fallen around 60% since the company announced the deal with Frontline 2012 in April last year.
The first tranche of shares issued to Frontline 2012 were worth $353.4m in total ($11.40 per share) on September 16, 2014, when the first part of the transaction was closed. The second tranche is worth a total of $127.1m at Knightbridge’s closing share price of $4.10 today.
The two share issuances (62.2m shares in total) have a combined worth of $480.5m, but would have been worth a total of $822.3m ($13.22 per share) on April 24, 2014, when the deal was announced, equivalent to $68.5m per newbuilding.
Online valuation platform VesselsValue.com (VV) today values Knightbridge’s newbuildings at between $40m-42m for each of the ten 180,000-dwt capes being built and $43m-45m for the two 205,000-dwt newcastlemaxes on order.
Resale contracts for 180,000-dwt capes due for delivery in 2015 and 2016 have respectively lost 28.3% and 24.9% of their value today compared to April 24, 2014, VV data says.