Greece’s Diana Shipping said on Friday that a $7.25m deal to sell the 73,700-dwt panamax Calipso (built 2006) has failed after the ship’s prospective new owners decided to walk out of the agreement.
Some market watchers say this is far from the only S&P deal to sour recently as slumping freight rates cause buyers to get cold feet and rush for the exit. In other cases, however, business disruption in China makes such transactions just impossible to carry out.
Athens-based Diana originally announced the deal to sell the Calipso on 27 December, long before the Coronavirus crisis hit. The ship was expected to be delivered to its buyers, an unaffiliated third party, by 30 January.
In a statement today, however, Diana said the agreement is no more. “The buyers elected to exercise their right to cancel the contract as a result of vessel’s missing the cancelling date stipulated therein, due to unforeseen events,” it said.
These unforeseen events had nothing to do with the condition of the Calipso, Diana added. The Simeon Palios-led company has already taken steps to refund the deposit received.
Vessel trackers show the Calipso at anchor at Zhoushan, China, since 8 January. TradeWinds understands that the vessel has been stuck there, unable to be delivered to its Chinese buyers as initially agreed, due to the Coronavirus crisis that has paralysed much of the country.
With ports grinding to a halt and crews hard to come by, ships are difficult to move. The financial and legal infrastructure necessary to buy and sell ships has been affected as well. “Banks aren’t working in China, law firms too,” said one broker in Athens. “You can’t even open an escrow account, so laycans are easy to miss,” the broker added.
These real problems, however, can also serve as a convenient excuse for buyers who got cold feet and simply want to walk away from acquisitions.
“If the market was better, I’m sure buyers would have found a way to see the deal through,” said one market source in Athens.
Chinese buyers have been among the few buyers active in the second-hand market. Reports of deal failures, of which the Calipso is just one, indicates that gloom can affect even the boldest buyers.
Another panamax transaction that may be hitting the buffers involves the 76,700-dwt Navios Star (built 2002) – a vessel reportedly sold by Navios Maritime Holdings to Chinese interests for between $6.2m and $6.6m.
