DryShips to sell 17 vessels at $795M loss, shares -36%

Sep. 10, 2015 11:24 AM ETDryShips Inc. (DRYS)By: Carl Surran, SA News Editor79 Comments
  • DryShips (NASDAQ:DRYS -36.8%) plunges on news it agrees to sell 17 of its bulkers to other entities controlled by Chairman/CEO George Economou, a move analysts say is part of a longer-term plan to recapitalize the business.
  • The 13 Capesize and four Panamax bulk carriers are being sold for a combined $377M, including their existing employment agreements and the assumption of $236M of debt.
  • DRYS says it will recognize a ~$373M related impairment charge in its Q3 results as a result of the sale; also, DRYS says it will classify all remaining vessels in its fleet, comprised of 20 Panamax and two Supramax bulk carriers, as held for sale, resulting in an additional impairment charge of ~$422M in Q3.
  • DRYS "has too much debt relative to its earning powers, relative to what rates are. They need to do something like this to recapitalize the company,” says Amit Mehrotra, Deutsche Bank’s lead shipping analyst.

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