Friday, May 13, 2011

Bulk Freight Group Continue To Acquire Vessels

US Group Continue Expansion
Shipping News Feature

US – WORLDWIDE – Despite the comparative lowly status of the Baltic Dry Index, one group trading in the bulk freight sector seems intent on continuing to mop up any spare capacity it fancies. New York based Genco Shipping & Trading has announced today it has taken delivery of the Genco Avra, a 35,000 dwt Handysize newbuilding. The Genco Avra is the third of five vessels to be delivered to the Company under Genco's agreement previously announced last June to acquire five Handysize vessels from within the Metrostar group of companies.

The latest acquisition is due to take up station with its charterer, Cargill International S.A. tomorrow and the rate for the time charter will be linked to the Baltic Handysize Index (BHSI), incorporating a floor of $8,500 and a ceiling of $13,500 daily, with a 50% profit sharing arrangement to apply to any amount above the ceiling. The rate will be based on 115% of the average of the daily rates of the BHSI, as reflected in daily reports. Hire will be paid every 15 days in advance, net of a 5.00% third party brokerage commission.

The agreement is for a three year spot market-related time charter, give or take six weeks, with Genco using available cash of $9.9 million as well as $20.0 million under its $100 million term loan facility to pay the remaining balance of $29.9 million for the new vessel. If Genco take up all the ships it has agreed to acquire the line will own a fleet of 53 drybulk vessels, consisting of nine Capesize, eight Panamax, 17 Supramax, six Handymax and 13 Handysize vessels, with an aggregate carrying capacity of approximately 3.8million dead weight tonnes. Genco also own nine other bulk vessels via their subsidiary company Baltic Trading Limited.

NB The Baltic Dry Index closed last night at 1320, up around 50 points from the start of the month but falling back from this months high of 1348.