Oaktree Capital Management has been Star Bulk Carriers’ anchor investor for nine years, but the US investment giant has been gradually reducing its once controlling stake to a current holding of just 7%.
However, this and any other possible stake reductions in the future will not fundamentally alter the way Star Bulk does business.
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“Not much will change,” Star Bulk chief executive Petros Pappas told TradeWinds, explaining that Oaktree has never been an obstacle to any move he proposed.
“We have been together for nearly 10 years without any hiccups or any problems. We always agreed on everything, they have proven to be the best partners for us.”
Oaktree’s gradual stake reduction comes as no surprise for Pappas, who has always believed that the US fund had an investment horizon of about a decade.
“Usually, this is 10-year money, plus a year or two in options — at some point, they have to return money to investors,” he said.
Oaktree remains among Star Bulk’s biggest shareholders.
Even if Oaktree decides to exit entirely, Pappas did not rule out the US investment fund returning under a different fund, given the mutually agreeable cooperation so far.
“We learned a lot from them and they learned a lot from us,” he said.
Oaktree’s latest share sales were back to Star Bulk, with the company spending $380m since last month to buy back 20m of Oaktree-owned stock.
Much of that money came from the lucrative secondhand sales of two capesizes and five supramaxes earlier in the year.
“We sold at a good time in the market, at very enticing prices well above net asset value, and then used that money to buy back the Oaktree shares,” Pappas said.
“We created a positive arbitrage for the company and the shareholders.”
