Pacific Basin Shipping on Thursday unveiled its plan to raise $175m via selling convertible bonds for fleet expansion and renewal.
In an exchange filing, the Hong Kong-listed bulker firm said the bonds would mature in December 2025 with a bondholder’s put option in December 2023.
Their initial conversion price is set at HKD $2.4 ($0.31) per share, representing a 31.9% premium to Thursday’s closing price.
“As part of our overall financing plan, we regularly seek out funding opportunities which we consider attractive and beneficial to our shareholders,” chief executive Mats Berglund said.
“This convertible bond issue represents an opportunity for us to access the convertible market on attractive terms and further enhance the group’s balance sheet and liquidity position to support the organic expansion and renewal of our fleet of handysize and supramax vessels.”
According to the company, $49.5m of the money raised would be used to fund its earlier acquisition of four secondhand vessels.
Pacific Basin in September agreed to buy one 2012-built supramax, one 2015-built supramax, and two 2015-built handysize ships for $73.8m.
At that time, the company was planning to fund the deals with cash and selling new shares worth $24.4m.
In Thursday’s statement, Pacific Basin suggested further vessel acquisitions would be “governed by prevailing market conditions”. The funds could be also used for general corporate purposes.
BNP Paribas, HSBC and DNB are acting as the joint lead managers for the bond issue, still subject to shareholders’ approval.
