EuroDry is willing to expand its fleet of seven bulkers, but the question is how that will happen.

The New York-listed 2018 spinoff of Euroseas may add to four panamaxes, two kamsarmaxes and one ultramax by buying a vessel here and there or entering into an M&A deal for faster growth, chief executive Aristides Pittas said.

"We do have about $10m cash in the company which we could use to buy a ship and lever it up 50%," he told TradeWinds Tuesday during the 32nd annual Marine Money conference in New York.

"We have the capacity to buy something but we are currently waiting to see what direction things get."

He said asset prices seem to be correcting to lower levels and, if that trend continues, then the company may buy a ship.

If asset prices rise, EuroDry will consider other vehicles besides cash and debt to acquire vessels, such as a ship-for-shares deal, he said.

"We're looking at that anyway, but nothing is really there to report at this point in time," he said.

"Nothing has been done."

Open to M&A

He said he is also open to en bloc purchases of vessels to grow the small fleet faster, but that can only be done through M&A with a partner willing to contribute ships.

"The capital markets are not open to raise equity at this point," he said.

Pittas points out, however, that having a larger fleet is not necessarily the goal or the mean to success in dry bulk shipping because most factors are relatively equal among owners.

"We are all having the same costs per ship and the same kind of charters for our ships," he said.

"Both cost and revenue side are not affected significantly by size. ... Profitability does not depend on having a bigger share of the market. Profitability depends on having a good market."

EuroDry plans to focus its expansion efforts on either panamaxes or ultramaxes between the "sweet spot" of five and 15 years old, he said.

We would be not most probably looking for newbuilds," he said.

He said EuroDry is interested only in those two asset classes in order to remain in the space between supramaxes and kamsarmaxes without specific growth plans for either class.

"It depends on the pricings in the market," he said.

Whatever the case may be, Pittas said he is optimistic that the dry bulk market will improve enough to allow for fleet expansion.

"I think that a solution to the trade wars will have a huge benefit," he said.

"We will also have the disruption of IMO 2020. ... Ships are going to go slower and more ships will stop to install scrubbers."