[070619.EN.SEA] Euroseas Buys Four Feeder Containerships With Cash And Shares

NASDAQ-LISTED Greek shipowner Euroseas has signed an agreement to purchase four secondhand vessels and refinanced two vessels to free up cash.

Euroseas, the provider of seaborne transportation for containerised cargoes, will acquire the four feeder vessels for a consideration that includes a cash payment of US$15 million and issuance of approximately 22.5 million shares to the sellers. 

The vessels are owned by affiliates of the Pittas family, controlled by Euroseas CEO Aristides Pittas, who explained that "the acquisition of the four vessels not only did it expand our fleet but also reduced its average age by 1.5 years".

After the vessel acquisition, Euroseas fleet will consist of 15 container vessels with all the vessels except for one being feeder containerships, reports Colchester's Seatrade Maritime News.

The vessels include the 2005-built, 1,700-TEU EM Hydra, the 2007-built, 1,700-TEU EM Spetses, the 2007-built, 3,100-TEU EM Kea, and the 1998-built, 2,008-TEU Diamantis.

Euroseas has also refinanced two vessels to free up about $8 million in cash, which together with approximately $3.7 million of its available cash will be used to redeem approximately $11.7 million of its Series B Preferred Shares.

After the agreed upon redemption of $11.7 million out of an aggregate value of about $19.7 million as of 31 March 2019, there will be $8 million of Series B Preferred Shares outstanding.

"The vessel refinancing and preferred stock redemption transactions achieve significant cost reductions for Euroseas. These developments alone are expected to reduce our interest and preferred dividend expense by more than $1.4 million per year," Mr Pittas said.

Source : HKSG.