USA based and New York Stock Exchange listed Eagle Bulk Shipping Inc (Eagle Bulk), has yesterday announced that it has approved an agreement with Oaktree Capital Management (Oaktree) or its affiliates that Eagle Bulk has repurchased approximately 3.8 million shares of Eagle Bulk’s common stock.
This large portion of shares is representing Oaktree’s entire stock ownership of approximately 28% in the company Eagle Bulk Shipping Inc.
Eagle Bulk inform that the purchase price the shares is approximately $219.3 million, and the company also stated that as a result of this transaction, the company’s outstanding common stock will be reduced to approximately 9.3 million shares and the transaction will be financed by cash-on-hand and drawings under the Company’s credit facility.
Furthermore, the company mention that their balance sheet remains strong, with total liquidity of approximately $188 million based on March 31, 2023 financials, as adjusted for this transaction, previously communicated financing, and vessel sale and purchase activity. The Company noted that it remains committed to its balanced capital allocation strategy, including maintaining its current dividend policy of 30% of net income, which we believe will be positively impacted by this transaction, and continued repayment of term debt.
Eagle’s Chairman Paul Leand, Jr. commented, “Today’s transaction is in the best interest of our shareholders, both financially and strategically. It ensures that shareholders maintain the opportunity to realize the value of their investment in Eagle Bulk and eliminates any potential disruption resulting from the sale of a very significant interest in the Company.”
Eagle’s CEO Gary Vogel added, “We believe the transaction will be significantly accretive to NAV per share and EPS in future periods based on historically strong supply-side fundamentals. Looking ahead, we will continue to execute on our growth and renewal strategy, including building upon our 33 previous ship acquisitions, and remain committed to acting opportunistically to create value for all of our shareholders.”
