Navios nabs capes

Angeliki Frangou’s Navios Maritime Holdings has raided the capesize resale market for a second time in three months.

Angeliki Frangou

Navios said it would pay for the two ships with a combination of cash, and mandatorily convertible preferred stock.

It said the effective price for the two ships, assuming a $10 conversion price of the preferred stock, would be $115.6m, or $57.8m per ship.

Both ships are due to be delivered from an unnamed South Korean shipbuilder in October and December 2010, it said.

The two ships each come with fixed charters of ten years at a rate of $29,356 per day plus two one year charter extension options.

The charters also include a 50:50 profit share for freight rates in excess of $38,500 per day, Navios added.

Navios said the material terms of the financing for the two vessels have been preliminarily agreed with a major commercial bank.

They are expected to include a $75m principal amount with a 1.75% margin over a 10 year term with a 14 year amortization profile.

“This transaction results from our efforts to capitalize on the opportunity caused by the credit crises,” said chief executive Angeliki Frangou.

“The acquisition price, considering the use of mandatorily convertible preferred stock, is well below the current charter-free value of the vessels.”

“As the vessels are secured by 10 year charters with creditworthy counterparties, we anticipate recovering more than 100% of the nominal acquisition price through EBITDA during the term of these charters.”

In June Navios agreed to acquire four capesize newbuilding resales on order in South Korea in a deal worth $324.5m.

Printable version Newsletter sign up