Genco Stock Rises After Diana Shipping Offers All Cash Buyout At 15% Premium

• The company said that the offer price represents a 15% premium to Genco’s closing price of $17.90 on November 21.
• Diana’s CEO Semiramis Paliou said that the company intends to finance the transaction through a new acquisition facility and will plan to selectively divest assets following a potential transaction.
• The company added that the proposed price is a 21% premium to the closing price of $15 on July 17, the date of the initial disclosure of Diana’s ownership stake in Genco.

Genco Shipping & Trading (GNK) shares jumped over 7% in early trading on Monday after Diana Shipping Inc. (DSX) submitted a letter to the former’s board of a proposal to acquire all of the outstanding shares of Genco not already owned by Diana for $20.60 per share in cash.

Diana Shipping said it currently owns approximately 14.8% of Genco’s outstanding shares. The deal values Genco at nearly $891 million.

The company said that the offer price represents a 15% premium to Genco’s closing price of $17.90 on November 21 and a 21% premium to the closing price of $15 on July 17, the date of the initial disclosure of Diana’s ownership stake in Genco.

Executive View

Diana’s Chief Executive Officer Semiramis Paliou said the proposal represents a compelling opportunity for Genco’s shareholders to realize immediate cash value for their shares at a premium to historical trading of the company.

“As the largest shareholder of Diana, I am confident that the addition of Genco’s fleet combined with Diana’s operating platform will increase the scale and flexibility of our fleet and enhance our operating leverage towards the dry bulk market at what we consider to be an opportune time of the cycle,” Paliou said.

“We intend to finance the transaction through a new acquisition facility and will plan to selectively divest assets following a potential transaction in order to optimize our fleet and balance sheet,” Paliou added.

How Did Stocktwits Users React?

Retail sentiment on Genco remained unchanged in the ‘bullish’ territory, with message volumes at ‘normal’ levels, according to data from Stocktwits. Diana Shipping’s sentiment improved to ‘extremely bullish’ from ‘bullish’ territory compared to a day ago, with message volumes at ‘high’ levels.

Shares of Genco have gained over 37% this year but Diana’s stock tumbled nearly 14% in the same period.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Also See: Fulton, Blue Foundry Announce All-Stock Merger Valued At $243 Million

Share

·

Add us on