Star Bulk Carriers Corp. (Star Bulk) (Nasdaq: SBLK, Oslo: SBLK), a global shipping company focusing on the transportation of dry bulk cargoes announced yesterday that it has entered into an en bloc definitive agreement with entities controlled by Delphin Shipping LLC (Delphin), an entity affiliated with Kelso & Company (Kelso), pursuant to which the Company will acquire eleven (11) operating dry bulk vessels.

Star Bulk Carriers Corp agrees to acquire eleven dry bulk vessels from Delphin Shipping LLC
Caption: Bulk carrier D. Centaurus -Image courtesy of Cengiz Tokgöz

The agreement is signed for an aggregate purchase price of $139.5 million, payable in the form of a) $80.0 million in cash and b) 4.503 million common shares of Star Bulk.

The Company has secured exhaust gas cleaning systems (EGCS) for all of the Vessels with attractive delivery dates.

The cash portion of the Purchase Price will be financed through proceeds of a new seven-year capital lease of up to $93.6 million with China Merchants Bank Leasing, and an additional tranche of $15.0 million for financing of Scrubbers, thus offering approx. $9.0 million of additional liquidity for Star Bulk.  

Below are the details of the Vessels to be acquired from Delphin:

 The Acquired Vessels:  YoB   Yard DWT
 Apus   2014  Jiangsu Hantong  63,100
 Aquila   2012  Jiangsu Hantong  56,500
 Cepheus  2012  Jiangsu Hantong  56,500
 Columba  2012  Jiangsu Hantong  56,500
 D. Centaurus  2012  Jiangsu Hantong  56,600
 Dorado  2013  Jiangsu Hantong  56,500
 Hercules   2012  Jiangsu Hantong  56,500
 Hydrus   2013  Jiangsu Hantong  56,600
 Leo  2013  Jiangsu Hantong  56,600
 Pegasus  2013  Jiangsu Hantong  56,500
 Pyxis  2013  Jiangsu Hantong  56,600
 Total      628,500

The Vessel Acquisition, which is expected to be consummated in June 2019, remains subject to the execution of definitive finance agreements and customary closing conditions. The technical management of the 11 vessels will remain with an entity affiliated with Technomar, while commercial management will be taken over by Star Bulk.

As a result of the contemplated transaction, entities affiliated with Kelso are expected to own approximately 4.6% of the outstanding common shares of the Company. After giving effect to the Vessel Acquisition, Star Bulk will have a fleet of 120 vessels on a fully delivered basis, aggregate 2 cargo-carrying capacity of approximately 13.1 million deadweight tons and vessels with an average age of 7.8 years.

Source: Star Bulk