International Seaways is taking to the equity market, looking to raise up to $25m.
The New York-listed tanker owner announced the at-the-market offering, underwritten by Evercore ISI and Jefferies, Thursday morning. The company said it will use the proceeds to pay off debt and for capital expenditures, including scrubbers.
"[I] wouldn't think they would print at these levels, but could [it] come handy another time," said Espen Landmark Fjermestad, an analyst at Fearnley Securities.
At the company's investor and analyst day in mid-December, chief executive Lois Zabrocky said the fourth quarter rally in tanker rates, coupled with low oil prices, should boost demand. Add International Seaway's recently-refreshed, younger fleet, and 2019 should be a good year for the company, she said.
Since, crude tanker markets have dropped, but remain above early 2018 lows, a level analysts called "healthy" earlier this week.
Before the open Thursday, International Seaways shares were down nearly 3% to $18.42.
According to the prospectus, the company had $123m in cash at the end of the third quarter of 2018, $32m of which is restricted. It also had $57m in short-term debt and $770m in long-term debt.
Evercore ISI and Jefferies will receive 3% sales commission each up to $12.5m and 2.25% after that.
