Eagle Bulk Wins $175mn Borrowing and Extension of its Credit Facility

Photo credit: Eagle Bulk Shipping

The Stamford-based Eagle Bulk Shipping, a shipowner and operator within the midsize drybulk segment, has agreed with lenders for an increased borrowing capacity of $175 million. The amended and restated credit deal also provides a reduction in margin, and an extension in maturity by two years.

The facility totals $485 million, comprised of a $300 million term loan and a $185 million revolving credit facility, and bears an interest rate of adjusted term SOFR plus a margin of between 2.05% and 2.75%, depending on leverage and the company meeting certain sustainability-linked criteria, Eagle said in an announcement on Wednesday. The facility has a maturity date of September 2028.

This financing has significantly increased the company´s liquidity position, with cash and available borrowings now totaling over $400m, allowing the shipowner to continue to take advantage of opportunities.

Eagle’s CEO, Gary Vogel, said “following the recent acquisition of four modern Ultramax vessels, this financing has significantly increased our liquidity position, with cash and available borrowings now totaling over $400 million. Our enhanced liquidity profile positions us well to continue to take advantage of opportunities and create value for our stakeholders, including the potential retirement of our convertible bond which matures in 2024.”

Meanwhile the top management states that the company remains positive about the medium-term prospects for the drybulk industry, due to the strong supply side fundamentals.

With a fully modern fleet of 52, predominately scrubber-fitted vessels, and $235 million of liquidity, the New York-listed owner is in a “unique leadership position”, as said by Eagle’s CEO Gary Vogel, to continue to take advantage of opportunities for the benefit of its shareholders.

Eagle’s CEO Gary Vogel commented, “on the vessel sale and purchase front, we continue to act opportunistically to create value for our stakeholders. Following our recent accretive acquisitions of four modern high-specification Ultramaxes, we have taken advantage of a recent increase in both S&P liquidity and ship values to sell three non-core, non-scrubber-fitted Supramax vessels, which were purchased opportunistically just two years ago. Based on our calculations, we generated a levered IRR of 70% on this S&P transaction, inclusive of cash generated.”