Diana Shipping Announces Cancellation of Shipbuilding Contract

By Finance

Diana Shipping Inc. (NYSE: DSX), a global shipping company specializing in the ownership of dry bulk vessels, Thursday (Nov 3) announced that, through a wholly-owned subsidiary, it provided a notice of:

  • cancellation of the shipbuilding contract with Yangzhou Dayang Shipbuilding Co., Ltd. and Shanghai Sinopacific International Trade Co., Ltd., dated January 8, 2014; 
  • and Addendum No. 1 to the Contract dated April 21, 2014 with Sumec Marine Co., Ltd. with respect to a Kamsarmax dry bulk carrier, Hull No. DY6006, with an original delivery date of May 31, 2016.

Diana Shipping Announces Cancellation of Shipbuilding Contract 

The Company has exercised its right under the Contract to cancel it due to a delay in delivery of 150 days after the original delivery date and to claim a refund of the pre-delivery installment payments in an aggregate amount of approximately US$8.65 million together with interest at a rate of 5% per annum from the date of receipt of the installment until the date payment is received by the Company. The refund of the aforementioned pre-delivery installments together with interest thereon is covered by a Refund Guarantee from the Export-Import Bank of China dated June 26, 2014. However, there can be no assurance as to the amounts ultimately payable or the timing of any refunds received under the Contract or the Refund Guarantee.

Diana Shipping Inc.’s fleet currently consists of 46 dry bulk vessels (2 Newcastlemax, 14 Capesize, 3 Post-Panamax, 4 Kamsarmax and 23 Panamax). In addition, the Company expects to take delivery of two new-building Newcastlemax dry bulk vessels during the fourth quarter of 2016 and the first quarter of 2017. As of today, the combined carrying capacity of the Company’s fleet, excluding the two vessels not yet delivered, is approximately 5.2 million dwt with a weighted average age of 8.03 years.

Source: Diana Shipping