Equity Sales Continue – Navios Maritime Partners and Safe Bulkers Follow-on

While the Golar LNG Partners IPO was a surprise, the prevalence of follow-on offering is not. Last week, Teekay LNG and Navios Maritime Partners LP (“Navios Partners”) successfully concluded their offerings and they were joined this week by Safe Bulkers Inc. While there is nothing that indicates that the window is closing, there nonetheless seems to be a rush to offer.

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Shipping Industry Primary Equity Offerings in the U.S. Public Market in the First Half of 2010

By Hannah Arntzen

There is hope for the shipping market yet!  According to a recent survey undertaken by Francois Janson and Frode Jensen of Holland & Knight LLP, in the first six months of 2010 there have been fourteen primary equity offerings in the U.S. Public market made by thirteen different issuers, Nordic American Tanker Shipping Ltd., Teekay Tankers Ltd., Overseas Shipholding Group Inc., General Maritime Corporation, Seanergy Maritime Corporation, Capital Products Partners L.P., Navios Maritime Partners L.P., Safe Bulkers Inc., Tsakos Energy Navigation Ltd., DryShips Inc., Baltic Trading Ltd., Crude Carriers Corporation, and Scorpio Tankers Inc. Three of those fourteen offerings were IPO’s, the remaining eleven offerings were follow-ons. Of those eleven follow-ons, nine were firm-commitment underwritings and one was an at-the-market offering. Ten of the issuers were foreign and organized outside the United States, two issuers were foreign but had headquarters in the U.S. and only one issuer was a U.S corporation with headquarters in New York City. Ten of the thirteen issuers were organized in the Republic of the Marshall Islands, one in the United States, and the remaining two in Bermuda.
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Ravenous Equity Appetite for Follow-ons Continues

Safe Bulkers Inc. joined the long line of recent issuers announcing last week that it would utilize its existing shelf registration and offer 9 million shares of it common stock in a follow-on offering. The offering will provide a green shoe of a further 1.35 million shares to cover overallotments. And, in order to minimize dilution, Vorini Holdings, Inc., the controlling shareholder (82%) of the company, has agreed to purchase 1 million shares at the offering price. Net proceeds will be used for vessel acquisitions, capex and for other general corporate purposes, including debt repayment.
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