Mercator Line announces Acquisition of a Gearless Panamax Vessel.
The Board of Directors of Mercator Lines (Singapore) Limited wishes to announce that: The Company has entered into a Memorandum of Agreement (the ?MOA?) for the purchase of a young and modern gearless Panamax dry bulk carrier for approximately US$ 38 million (the ?Proposed Acquisition?). The vessel is less than 3 years old, built in 2007 by Hudong Zhonghua Ship Building Group, Shanghai, China, and has a capacity of about 74,483 dwt.
The vessel is due to be delivered in April / May 2010, and will expand the Company`s owned fleet to 12 vessels with an aggregate capacity of 1.1 million dwt. This acquisition is proposed to be financed through a mix of internal accruals and debt.
The vessel comes with an attached charter with a reputed company at a daily charter hire of USD 22,250 per day for 35-37 months. This contract would bring in revenues of about USD 24 million over the next three years.
This Proposed Acquisition is expected to have positive impact on the net tangible assets per share, earnings per share and operating results of the Company for the financial year ending March 31, 2011.
The Sellers are unrelated to the Directors and controlling shareholder of the Company. None of the Directors and controlling shareholders of the Company has any interest, direct or indirect, in this acquisition. The acquisition is in the ordinary course of the Company's business.