Eagle Bulk: The “Greeks” Have Returned

Credit: Hellas Posts /Eagle Bulk

A recent news article published in the Hellas Posts states that Eagle Bulk: The “Greeks” are back.

Developments at Eagle Bulk

Developments at Eagle Bulk, listed on the American stock exchange, are moving at cinematic speed.

With the entry into the share capital of Danaos of dr. Ioannis Kousta and Castor Maritime of Petros Panagiotidis, the Greek shipowners are returning to the company that Sofocles Zoulas had introduced in 2005.

From the Danaos investment within a few days, the exit of the Oaktree Capital Management fund followed in order, the decision of the company’s board of directors to set a 15% limit on the possibility of gathering shares, the harsh response of Danaos which in the meantime had exceeded the 15% due to the exit of Oaktree, the entry of Castor with a percentage of 14.99% and finally the response of the management of Eagle, late last Friday night, to Mr. Kousta through which it tries to defend its decisions.

In particular, Danaos gradually increased its percentage to 11.3%, while the management of Eagle Bulk bought 28% of the shares of Oaktree Capital Management, which was also the largest shareholder, while deciding to change its articles of association so that no shareholder can exceed 15%. However, the “withdrawal” of the American fund’s shares raised Danaos’ percentage to 16.7% and made it the largest shareholder, but above the limit. This fact caused the reaction of the Greek company, which responded in a harsh tone: According to what it reported, a 35% premium was paid for the acquisition of Oaktree’s shares compared to the average of the stock over the last 45 days. “We find it difficult to understand how the company’s decision to repurchase Oaktree shares benefits all Eagle Bulk shareholders, and question whether the decisions made by the company were the most efficient, considered or beneficial to all shareholders,” it said.

In the meantime, late Friday afternoon, Castor Maritime also appeared on the board with the main shareholders of Eagle, while a little later the chairman of Eagle, Paul M. Leand, responded to Danaos by emphasizing, among other things: “The Board of Directors concluded to its unanimous decision to purchase the shares of Oaktree Capital and to adopt a shareholder rights plan as a means of promoting the best interests of our shareholders.” He also claims that the Premium given to the American fund is 16% over the June 12 valuation.

Why they invest in Eagle

Apart from the fact that Oaktree had made it known that it wanted to sell its shares, thus opening up “space” for new investors, in the coming years the dry bulk market is expected to rise, perhaps even spectacularly. The reason has to do first of all with the scarce supply of capacity, and secondly with demand. At the moment the order book is still at a historic low of just 8%, while in the coming years a large number of bulk carriers are expected to withdraw due to the new environmental regulations. In fact, for some time the fleet may even show a decline. Along with today’s forecasts for a global recovery, demand for capacity is expected to be at a level higher than supply.

At the same time, Eagle Bulk is a company with a fleet of 52 ultramax and supramax bulk carriers, with a total capacity of 3.2 million dwt and with an average age of less than 10 years. (9.8 years). Which means her fleet is modern, with only five of her ships built before 2010 (four in 2009 and one in 2008).

Its capitalization amounts to 466 million dollars, according to data as of June 30, 2023, its debt obligations to 348 million dollars, while the value of the company is 660 million dollars. Its revenue at the end of 2022 was $248 million, up $63 million from 2021.

Entering the US stock market

2005 was a good time to introduce a company to the American stock market, said a few days ago Mr. Aristides Pittas (head of the Euroseas group with 30 ships), in the context of the Pireas 2023 conference, organized every two years by Greek shipping brokers .

That was also the time when Mr. Sofocles Zoulas introduced the “eagle” to the American stock market. At a time when the market was constantly rising. The company constantly expanded its fleet, reaching about 1.2 billion dollars in debt. With the collapse of the global economy, which dropped the charter market index “below zero” and the simultaneous bankruptcy of Korean Lines, Mr. Zoulas made efforts to save the company. In the end, he succeeded with the “help” of Oaktree, which also took over the company’s equity control in 2013, while he finally resigned from the management of the company in early 2015.


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Source: Hellas Postsen


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