Star Bulk Signs Capesize Newbuilding Contract, Agrees to Ten Year Time Charter
Star Bulk Carriers Corp. yesterday announced that it has signed a contract with ship builder Hanjin to build a Capesize vessel of 180,000 deadweight tons, at a price of $53.5 million with expected delivery in September 2011. The Company has also entered into a ten year time charter agreement for the vessel with STX Panocean at a gross daily hire of $24,750.
Star Bulk has also received offers for debt financing of up to 70% of the vessel's price at favorable financing cost/terms and expects to complete the financing within the second quarter of 2010. The Company has not yet decided the ratio of Company cash to senior debt that it will utilize in this acquisition.
Akis Tsirigakis, President and CEO of Star Bulk, commented: "We are pleased to grow organically with the acquisition of a newbuilding Capesize vessel from a high quality ship builder. This deal involved the challenge of putting all required elements together simultaneously, namely, quality builder, competitive price, good contracted employment, quality counterparty and competitive financing. The vessel contract was achieved at a very favorable price considering recent similar newbuildings. We are also pleased that our senior debt lenders continue to support our acquisition plans via offers of favourable financing terms.
"Currently, our fleet is contracted for 92% of 2010 and 58% of 2011 operating days, amongst the highest contract coverage in the industry, providing future earnings visibility. We continue to focus on enhancing shareholder value, supported by our strong balance sheet and liquidity."
About Star Bulk
Star Bulk is a global shipping company providing worldwide seaborne transportation solutions in the dry bulk sector. Star Bulk's vessels transport major bulks, which include iron ore, coal and grain and minor bulks such as bauxite, fertilizers and steel products. Star Bulk was incorporated in the Marshall Islands on December 13, 2006 and maintains executive offices in Athens, Greece. Its common stock trades on the Nasdaq Global Market under the symbol "SBLK." Currently, Star Bulk has an operating fleet of eleven dry bulk carriers with definitive agreements to buy one and sell one Capesize vessel as well as to build one Capesize vessel. The total fleet consists of five Capesize, and eight Supramax dry bulk vessels with a combined cargo carrying capacity of 1,282,377 deadweight tons. The average age of our current operating fleet is 10.3 years.