Greek headquartered and Nasdaq-listed Star Bulk Carriers (Star Bulk) and USA-based and New York Stock Exchange listed Eagle Bulk Shipping (Eagle) have announced that the companies have entered into a definitive agreement to merge and create a 169 vessel drybulk fleet from Supramax/Ultramax to Newcastlemax/capesize.

This merger is an all-stock merger on a Net Asset Value to Net Asset Value (NAV) basis with a pro forma market capitalization of approximately $2.1 billion, and under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, Eagle shareholders will receive 2.6211 shares of Star Bulk common stock for each share of Eagle common stock owned.

This represents a total consideration of approximately $52.60 per share, a 17% premium based on Eagle’s closing share price of $44.85 on December 8, 2023.

Upon the close of the transaction, Star Bulk and Eagle shareholders will own approximately 71% and 29% of the combined company on a fully diluted basis, respectively, as the companies’ state.

The combined company will be led by the current management team of Star Bulk and will be joined by certain senior executives of Eagle.

Upon close, Mr. Pappas will serve as CEO of the combined company and Spyros Capralos, current Chairman of Star Bulk, will serve as Chairman of the combined company’s Board.

One member of the Eagle Board will join the Star Bulk Board at closing.

The combined company will operate as Star Bulk Carriers and will be headquartered in Athens, Greece, while maintaining offices in Stamford, Connecticut; Singapore; Copenhagen; and Limassol.

The transaction is expected to close in the first half of 2024, subject to approval by Eagle shareholders, receipt of applicable regulatory approvals, and satisfaction of other customary closing conditions.

“Bringing together Star Bulk and Eagle will create a global leader in dry bulk shipping with a large, diversified, scrubber fitted fleet. Together we will benefit from greater scale with 169 owned vessels, generating meaningful synergies and building an even stronger financial profile. We will leverage both companies’ technical and commercial fleet management capabilities to optimize performance, deliver on our health, safety, and environmental objectives and maximize earnings potential.”

“With a well-capitalized balance sheet, we aim to continue delivering strong cash returns to shareholders while investing in emission reduction technologies as we continue to pursue growth over the long term. We look forward to working with the talented Eagle team to successfully integrate the two companies,” said Petros Pappas, chief executive of Star Bulk.

“We are very excited to be joining forces with Star Bulk, uniting two best-in-class companies, both commercially and operationally. We are bringing together two highly complementary organizations and are confident that this accretive merger with Star Bulk will unlock significant value for Eagle shareholders, including the opportunity to participate in the long-term upside of the combined company,” said Gary Vogel, Eagle chief executive officer.