Pacific Basin Offers Shares for Charter Rate Cuts

Image Courtesy: Pacific Basin

Pacific Basin Chartering Limited, a subsidiary of Hong Kong-listed dry bulk shipping company Pacific Basin Shipping, has entered into agreements to issue new shares in the company in exchange for charter rate reductions for ten chartered-in Handysize and Supramax bulkers.

Namely, the company entered into ten separate addenda, all dated October 21, to existing long-term time-charter contracts with ten shipowners, pursuant to which the company has agreed to issue a total of over 79,9 million shares at HKD 1.218 (USD 0.16) per share.

Under the addenda, the existing daily charter-hire rates will be reduced by a total of USD 12.5 million over a 24-month period, starting on November 1, 2016.

The reductions would result in cash savings of USD 1 million, USD 6.2 million and USD 5.2 million in 2016, 2017 and 2018, respectively.

Pacific Basin said that the agreements enhance its cash balances and ability to maintain the group’s balance sheet strength in the protracted weak dry bulk market.

The move was made less than a month after Pacific Basin said that its vessel earnings outperformed the dry bulk freight market indices in the third quarter of 2016.

The company generated average Handysize and Supramax daily TCE earnings of USD 7,040 and USD 7,360 per day net in the third quarter, while the average Handysize and Supramax daily net TCE earnings were at USD 6,400 and USD 6,430.

“The market benefitted from seasonally strong US grain export volumes during the third quarter, as well as increased iron ore and coal imports into China. However, the market remains oversupplied with vessels, and conditions are still challenging for shipowners,” Pacific Basin Shipping said.

Share this article

Follow World Maritime News

In Depth>

Events>

<< Feb 2018 >>
MTWTFSS
29 30 31 1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 1 2 3 4

Shipping 360

This course is ideal for those who have recently joined the maritime sector and those who need to have a better understanding…

read more >

APM – ASIA PACIFIC MARITIME 2018

27 years in the making, APM is the premier shipbuilding & marine, workboat and offshore exhibition in Asia trusted by generations of industry professionals.

read more >

Shippax Ferry Conference 2018

The two-day onboard ferry conference was first organized in 2003 and grows ever more popular with some 400 delegates from over 40 ferry…

read more >

8th Dredging & Land Reclamation World Summit 2018

The 8th Dredging and Land Reclamation Summit 2018 will gather the decision makers from Authorities and Operators responsible for ports…

read more >