Baltic Trading purchases two handysize vessels

9 September 2013 (Last Updated September 9th, 2013 18:30)

Baltic Trading has purchased and taken delivery of two 32,000dwt handysize vessels, Baltic Fox and Baltic Hare.

Baltic Trading has purchased and taken delivery of two 32,000dwt handysize vessels, Baltic Fox and Baltic Hare.

Both vessels have been entered into the Clipper Logger Pool, operated by Clipper Bulk.

The company signed a deal to buy the 2010-built Baltic Fox and 2009-built Baltic Hare in July 2013.

Baltic has also finalised its $22m credit agreement with DVB Bank, which it signed on 8 July 2013.

The company used the proceeds from the new credit facility and proceeds from its May 2013 equity offering to purchase the Baltic Fox and Baltic Hare.

Under the terms of the six-year credit facility, Baltic will have to repay the amount in 24 quarterly installments of $375,000, the first of which is to be paid in December 2013, as well as a balloon payment of around $13m to be paid at the same time as the last repayment installment.

Baltic president and chief financial officer John Wobensmith said the company is pleased to take delivery of the Baltic Fox and the Baltic Hare, as planned, and enter the vessels into a spot market-related vessel pool consistent with their fleet deployment strategy.

"The Baltic Fox and the Baltic Hare combine to expand our modern, high-quality fleet by approximately 10% on a tonnage basis while further strengthening our position in the global transportation of essential commodities and increasing our long-term earnings potential," Wobensmith said.

In another development, the company has also signed a deal with Nordea Bank Finland and Skandinaviska Enskilda Banken to amend provisions of its 2010 senior secured revolving credit facility.

Under the terms of the amended credit facility, the company is allowed to incur additional debt.

The company’s commitment amount has been decreased from $125m to $110m, and will further be reduced in three consecutive semi-annual reductions of $5m beginning from 30 May 2015.

Wobensmith said in support of their growth initiatives, management has taken active measures to increase Baltic Trading’s financial flexibility by closing a new $22m credit facility with a global lending institution and amending their 2010 credit facility under favourable terms to allow for the incurrence of additional debt going forward.

"We appreciate the support that we have received from our expanded lending group and remain focused on preserving a sound capital structure as we pursue additional opportunities to take advantage of an attractive acquisition environment," Wobensmith said.