Dry bulk specialists Genco Shipping & Trading Limited has closed on a five-year senior secured credit facility in an aggregate principal amount of up to USD 460 million.
Proceeds from the new credit facility were used, together with cash on hand, to refinance all of the company’s existing credit facilities into one facility and pay down the debt on the oldest seven vessels in Genco’s fleet.
“We are pleased to have closed on this attractive USD 460 million facility, which was oversubscribed by approximately 40%. With this new facility, we have strengthened our position to capitalize on attractive growth opportunities and have provided Genco with the ability to pay dividends, while simplifying the Company’s capital structure,” Apostolos Zafolias, Chief Financial Officer, said.
The new USD 460 million facility lowers Genco’s interest costs through improved pricing, eliminates near-term refinancing risk by extending loan maturity to 2023, establishes an attractive amortization profile, and enhances the company’s flexibility to execute its fleet growth and renewal program by lifting restrictions on vessel acquisitions and additional indebtedness.
The final maturity date of the facility will be May 31, 2023. Borrowings under the facility will bear interest at LIBOR plus 325 basis points through December 31, 2018 and LIBOR plus a range of 300 to 350 basis points thereafter, dependent upon total net indebtedness to the last twelve months EBITDA.
Scheduled amortization payments USD 15 million per quarter commencing on December 31, 2018 and may be recalculated upon the company’s request upon certain events.