Non-Subscriber Extract
Year of the shipping IPO
- Article Tools
| 20 October 2005 |
By Barry Parker
The 'Year of the Shipping IPO' (initial public offering), which 2005 will surely be dubbed, continued to be bittersweet as the autumn winds blew down the narrow canyons of Wall Street.
A panoply of IPOs provides the backdrop against which rating agency Standard & Poor's (S&P) issued its latest 'Industry Report Card: Global Shipping'. According to S&P: "We believe that the tanker and drybulk freight rates are likely to remain above historical averages, at least in the near term." The report goes on to express concerns about the medium outlook, which S&P says "is clouded by uncertainties with regard to the future demand and supply balance".
On the brightest note of the past several weeks, Eagle Bulk Shipping - a drybulk specialist that launched its IPO in early summer - pulled off a successful secondary equity offering of USD102 million to support the USD70 million purchase of two new super-handymax vessels that will be leased back to the sellers at hefty rates. Eagle, recently trading USD17 per share, is up handsomely from its IPO price of USD13.50.
At the bitter end of the spectrum, Golden Energy - a Greek tanker company seeking to diversify its portfolio with the purchase of panamax bulk carriers - pulled the plug on its planned equity offering. Similarly, in late spring, Top Tankers pulled back a secondary offering that would have partly funded the purchase of a large drybulk fleet.
With the possible exception of Aries Maritime, a mid-year IPO, energy investors, a mainstay of support for shipping equities, have had difficulties evaluating companies that straddle two or more market sectors. Indeed, rumours were already circulating that Golden Energy's next try at an IPO - when and if it happens - would place a pure tanker play on offer.
294 of 2,606 words