Greece’s tanker shipowner Top Ships is to diversify further with the purchase of real estate assets in Dubai.
In a securities and exchange commission filing, the New York-listed Top Ships said the company has entered into a letter of intent for the potential acquisition of certain residential real estate assets in Dubai from a company affiliated with Mr. Evangelos J. Pistiolis, the company’s president and chief executive officer.
Under the letter of intent, TOP Ships has been granted an exclusive right and an option to acquire all or a portion of a portfolio of assets with an estimated aggregate market value in excess of $200m.
Dubai is one of the world’s most attractive real estate markets, supported by a high-growth economy.
The purchase price on exercise of the option with respect to any of the properties will be at a 10% discount to fair market value.
Before December 31, the company said it will make an advance cash payment of $23.5m to be credited against the acquisition price or refunded to the extent the company does not elect to exercise the purchase option. The option period expires 90 days following this advance payment.
The New York-listed shipowner said the move was approved by a special committee composed of independent members of the company’s board of directors.
The exercise of the purchase option remains subject to the approval of the special committee.
Top Ships stressed that there is no assurance that the purchase option will be exercised or that the acquisition of the assets subject to the purchase option or any similar transaction involving real estate assets will be consummated.
The special committee plans to use the 90-day option period to conduct a due diligence process and assess market conditions and other factors.
