Genco Shipping & Trading has entered into a definitive merger agreement to acquire its subsidiary Baltic Trading in a stock-for-stock transaction.
As a result of this new development, Baltic Trading will now become an indirect, wholly owned subsidiary of the US-based drybulk shipping company.
Genco and Baltic Trading boards of directors chairman Peter C Georgiopoulos said: "This transaction is a natural evolution for Genco and Baltic Trading, and we are confident that it will deliver superior value to the shareholders of both companies.
"The combined company will be poised to capitalise on opportunities in the current market environment and we believe the combined platform is well-positioned for continued growth as a consolidator in our industry.
Under this agreement, Baltic Trading shareholders will receive 0.216 shares of Genco common stock for each share of Baltic Trading common stock. The transaction is expected to close in the third quarter of this year.
This merger will see Genco shareholders hold an 84.5% stake in the combined company, while the Baltic Trading shareholders will own the remaining 15.5%.
According to Genco, the new company will have a combined fleet of 70 drybulk vessels with an average age of 8.8 years and a total carrying capacity of 5.16 million dwt.
The combined fleet will comprise 13 Capesize, eight Panamax, 21 Supramax, four Ultramax, six Handymax and 18 Handysize vessels.