It was like Christmas come early for New York-listed Eagle Bulk Shipping when GoldenTree Asset Management showed up to backstop an equity raise late last year.
Now, the private equity firm may be the one celebrating.
Back in 17 December, Eagle Bulk was looking for $25m in an overnight equity raise to help fund its acquisition of two ultramaxes from Scorpio Bulkers and possibly other targets.
While Stamford, Connecticut-based Eagle Bulk was able to raise about $5m from the public, nearly $20m in proceeds came when GoldenTree Asset Management agreed to backstop the shares issue.
GoldenTree, Eagle Bulk's second-largest holder, got nearly 1.1m shares at a bargain $18.10 price, down from $19.11 at the previous close and $19.59 just before the raise was announced.
But the initial discount was not the half of it.
Eagle Bulk recently helped GoldenTree register those sales for eventual sale under a shelf filing, with Eagle Bulk stock now trading above $47.
And while there has been no indication yet of an imminent sale by GoldenTree, this year's upsurge in the value of dry bulk shares could see it tripling its initial investment by the time it does elect to cash in.
GoldenTree remains Eagle Bulk's second-largest shareholder after Oaktree Capital Management on the basis of those 1.1m shares, which represent about 8% of the company.
But the New York firm headed by Steven Tananbaum has been in sell mode, having disposed of some 1.9m Eagle Bulk shares in July in a deal underwritten by Morgan Stanley at $46.50 each. The sale brought in more than $90m.
GoldenTree held about 22.6% of Eagle Bulk shares prior to the sell-off.
Oaktree currently holds about 28.1% of the stock, down only slightly from its level at the end of the first quarter.
If GoldenTree did well in the December shares deal, it was not a bad outcome for Eagle Bulk either.
The overnight offering is known to have supported its acquisition of Scorpio's 63,655-dwt SBI Gemini (built 2015), for about $16m, and 63,605-dwt SBI Aries (built 2015), for $16.5m. Now trading as Oslo Eagle and Helsinki Eagle, the pair are worth a combined $51m, according to VesselsValue.
Founded in 2000, GoldenTree lists some $46bn in assets under management for institutional investors including public and corporate pensions, endowments, foundations, insurance companies and sovereign wealth funds.
