New York-listed Scorpio Bulkers is on a pace to sell the remaining vessels in its fleet by the end of March next year, making its transition to the wind energy sector much more rapid than most have assumed.
Scorpio Bulkers president Robert Bugbee did not exactly deflate the notion that the owner of 43 units could be down to zero by the end of next year's first quarter.
In a brief interview, Bugbee declined to comment on reports that the owner is selling is eighth vessel in recent weeks. Brokers say the 61,000-dwt SBI Hyperion (built 2016) has gone to Greek buyers at a reported $17.5m.
But Scorpio Bulkers then confirmed the sale in a filing after the close of trading on Thursday.
Scorpio Bulkers has settled into a pace of selling at least two units per week from its fleet of kamsarmaxes and ultramaxes.
As the process has continued, it has become clear that the sales are less of a first phase of the transition into wind turbine installation vessels (WTIVs) and more a speedy campaign to move out of dry bulk.
At the current pace, Scorpio Bulkers would be done with dry bulk by March.
"We won't comment on that," Bugbee said. "But I am happy to say that on our earnings call next [Tuesday], we intend to provide a more detailed timetable of the transition.
"This will include details about the disposition of the dry cargo fleet and also about an imminent signing of the contract for the WTIV."
Bugbee declined to comment further ahead of the earnings report.
As TradeWinds has reported, Scorpio Bulkers' sales have consistently been below the prices assigned by VesselsValue, and that continues for the SBI Hyperion. The Chinese-built ultramax is assigned a value of $18.07m.
Joakim Hannisdahl, Cleaves Securities' head of research, also seized on the trend in a client note on Thursday, citing prices at 13% below its own valuations and comparable sale-and-purchase deals for the kamsarmaxes, and 6% below market for the ultramaxes.
In August, Emanuele Lauro-led Scorpio Bulkers said it was ordering up to four WTIVs at South Korea's Daewoo Shipbuilding & Marine Engineering at a cost of up to $290m each.
So far, it has signed only a letter of intent on the first firm unit referenced by Bugbee on Thursday, but the company has said a signed contract is expected in the current quarter.
While some analysts have said they anticipate a full sell-off of the bulker fleet, most have assumed the process to be much more gradual than what Scorpio Bulkers' management apparently intends at the current pace.
Proceeds from a full disposal of the fleet are expected to provide the equity portion for the first two newbuildings without the need to raise more cash in the near term.
This story was amended to reflected Scorpio Bulkers' confirmation of the sale of the SBI Hyperion after the close of trading on Thursday.
