Greek capesize owner Seanergy Maritime Holdings is aiming to boost its attractiveness to investors following more securities buybacks.
The Nasdaq-listed bulker company is planning a reverse stock split of its shares to reduce their number and increase the price.
This will be carried out at a ratio of not less than one share for every eight now, and not more than a one-for-12 swap, as Seanergy also tries to make sure it stays above the $1 minimum for a listing.
It currently trades at $0.62 per share.
Seanergy said some institutional investors and funds are reluctant to invest in lower-priced companies — and in some cases may be prohibited from buying shares — while brokerages are also loath to recommend lower-priced stocks to their clients.
The company has just completed $8.8m of buybacks, including $8m of convertible notes and $800,000 on warrants for 4m shares.
Chief executive Stamatis Tsantanis, who has bought a further 250,500 Seanergy shares in January, said: “The additional buybacks we completed recently are another example of our shareholder rewarding initiatives that we have implemented successfully over the last 12 months.
“We have addressed decisively the legacy overhang on our share price, whilst generating savings in interest expenses. We continuously demonstrate our strong commitment to enhancing value for our shareholders.”
He said his own buying of shares has accelerated, to show “strong confidence in our company’s prospects and the industry’s fundamentals”.
Stock buying to continue
“I intend to continue demonstrating my support this way going forward…” he added.
“In addition to ensuring Nasdaq’s listing standards are met, we believe that eliminating trading uncertainties and consolidating the outstanding number of our common stock will be very beneficial for our shareholders and will also increase the investor outreach for our stock, attracting fundamental, longer-term shareholders.”
A shareholders’ vote on the stock split will be held on 7 February.
Seanergy, which has 16 bulkers, has spent $35.5m on securities buybacks since December 2021.
The latest deals prevent a potential dilution by 10.7m shares.
The notes, held by Jelco Delta Holding Corp, carried interest of 5.5%, meaning annual interest savings of $440,000.