Greek dry bulk giant Star Bulk is growing its fleet to 120 vessels with the acquisition of the entire fleet of Kelso & Company’s Delphin Shipping.
Star Bulk is paying $139.5m for the vessels, made up of 10 supramaxes and an ultramax, via a combination of $80m in cash and the remainder in shares. It has also secured scrubbers for each of the vessels with “attractive delivery dates”.
The cash portion of the deal will be financed through proceeds of a new seven-year capital lease of up to $93.6m with China Merchants Bank Leasing, and an additional tranche of $15m for financing of the scrubbers.
The vessels acquired are the from Delphin are the 2014 ultramax Apus, 2012-built supramaxes Aquila, Cepheus, Colombia, D. Centaurus, and Hercules as well as 2013-built supramaxes Dorado, Hydrus, Leo, Pegasus and Pyxis. All were built at China’s Jiangsu Hantong Ship Heavy Industry.
Star Bulk expects to close the deal during June, lifting its fleet to 120 vessels. The 11 incoming vessels will be commercially managed by Star Bulk and technically managed by an affiliate of Technomar.
In a note to clients, Cleaves Securities said the deal is highly accretive to current Star Bulk shareholders and that it expects the company’s share price to trade significantly up on the news.
Star Bulk was dry bulk’s biggest consolidator last year, acquiring both Songa Bulk and Augustea in deals which added over 30 vessels to its fleet.
Kelso, which also has stakes in Eagle Bulk Shipping and Global Ship Lease, will come out of the deal with a stake of around 4.6% in Star Bulk.