Grindrod Shipping Holdings Ltd, a global provider of maritime transportation services in the drybulk and product tanker sectors, announced a number of transactions relating to a new financing arrangement, its fleet and share repurchases.
Further to the previously-announced financing arrangements in respect of IVS Knot and IVS Kinglet, we expect to enter into a similar financing arrangement with a Japanese shipowner in respect of the 2011-built handysize drybulk carrier, IVS Magpie, for a cash amount of $10.3 million (before commissions but net of charter pre-payments). The Company will bareboat charter the vessel back for a period of up to 12 years and has the right, but not the obligation, to acquire the vessel from the end of the second year of the charter, with the new owner having the right, but not the obligation, to sell the vessel to the Company at the end of the 12 year charter period. The IVS Magpie constitutes part of the security package for our $100.0 million senior secured credit facility and will be released from the security package in connection with the closing of the transaction. At closing, which is anticipated to take place in November 2019, the sale is expected to generate approximately $5.4 million of cash for the Company after settling the debt associated with the vessel. We can provide no assurances that this transaction will be concluded.
The prevailing charter agreement for our long-term chartered-in 2014-built Japanese eco supramax vessel, IVS Crimson Creek, includes a fixed period ending December 2019, with extension options covering a further two years at pre-determined charter rates. We have agreed with the owner of the vessel, subject to conclusion of charterparty documentation, to substitute the existing extension option periods and charter rates with a firm extension at a revised rate structure for a period of about 15 to 17 months from December 2019.
Pursuant to the Company’s previously approved share repurchase authority granted by shareholders at the last Annual General Meeting on May 29, 2019, the Company has acquired a combined total of 79,328 ordinary shares in the open market on NASDAQ and the JSE over the period from the end of the second fiscal quarter through and including October 29, 2019. The repurchased shares were acquired at an average price per share over such period of $5.75, or ZAR 84.13 based on an assumed ZAR/USD exchange rate of 14.63, before costs. The timing and amount of any repurchases are in the sole discretion of the Company, and depend on legal requirements, market conditions, stock price, alternative uses of capital and other factors. Repurchases of ordinary shares may take place in privately negotiated transactions and/or open market transactions. The repurchase authority expires at the next Annual General Meeting, unless renewed, and may be suspended or terminated by the Company at any time without prior notice.
Source: Grindrod Shipping Holdings Ltd.