Baltic, based with Georgiopoulos' other companies in New York though incorporated in the shipping tax haven of the Marshall Islands, will offer 16.3 million shares at $14 to $16 apiece, with an over-allotment option of about 2.4 million shares. The company thus hopes to raise about $300 million. Baltic's lead bankers on the deal are
and the boutique firm
. Georgiopoulos has been traveling for the better part of the last two weeks, conducting the Baltic road show.
Baltic's business model is simple: All of its ships (of which, as of yet, none are in the water) will operate on the spot the market -- or have full exposure to it through the kinds of long-term charters that track moves in spot-market shipping rates.
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started life in the public markets similarly, as a near-pure-play spot-market shipping stock.
In some ways, then, Baltic is less a company than a wagering vehicle with which investors can play the spot market and the volatile fluctuations that characterize short-term ocean-going dry-cargo freight rates. Genco's management will serve as Baltic's management and fleet administrator -- with Baltic paying its parent company a fee for the privilege. Baltic does intend, however, to distribute all of its net income to shareholders via a quarterly dividend.
As for its initial fleet, Baltic will use proceeds from the offering to buy four Supramax and two Capesize vessels. It won't take on any long-term debt to make the purchases, according to its prospectus; one of the company's aims is to keep leverage low, a lesson perhaps learned during the financial crisis, when many shipping concerns used cheap credit to aggressively expand their fleets, only to see those loans go underwater.
Baltic's ships -- all newbuildings -- are scheduled for delivery in April, except one of the Capesizes, which will hit the water in October.
Crude Carriers, meanwhile, hopes to sell 13.5 million shares for $19 to $21 each, raising as much as $310.5 million. The Piraeus, Greece-based company, also incorporated in the Marshall Islands, will buy three ships from its parent company -- one Suezmax and two very-large crude carriers, or VLCCs -- which will constitute Crude's initial fleet.
-- Written by Scott Eden in New York