Another case of private equity's departure from its shipping bets, dubbed "Prexit", surfaced on Tuesday as the second-largest investor in New York-listed Eagle Bulk Shipping heads to the exit door.
GoldenTree Asset Management is looking to sell more than half of its 3m shares in the Connecticut-based bulker owner.
The fund contracted with investment bank Morgan Stanley to sell 1.5m units initially.
But later on Tuesday the offering was increased to 1,695,182 shares and priced at $46.50 each.
This would make the deal worth nearly $79m.
An unnamed underwriter will also have a 30-day option to purchase up to 254,277 additional shares worth $11.8m.
Eagle shares hit a 52-week high of $56.47 on Friday. Following a retreat on Monday, they climbed 1.3% on Tuesday. However, Eagle fell nearly 6% in after-hours trading to just over $48 on the GoldenTree news.
With roughly 22.6% of Eagle's outstanding shares, GoldenTree is currently the second largest holder after Oaktree Capital Management, which has 3.8m shares and 30%.
The sell-down is the latest in private equity's march out of shipping, one that in many cases has been delayed for years as funds waited for tepid shipping share prices to start climbing.
The wait is over for many in dry bulk, where shares have jumped with rates in the first half of 2021.
New York's Genco Shipping & Trading saw its top three private-equity holders sell all or most of their stakes in disposals over time into the market.
Greece-based and New York-listed Star Bulk has watched largest holder Oaktree make two major sales in recent weeks, one in a "bought deal" to Morgan Stanley and the other in an underwritten secondary sale much in line with GoldenTree's new effort. That deal also was marketed by Morgan Stanley.
Eagle Bulk chief executive Gary Vogel told TradeWinds in a recent interview that large holdings by private funds can be argued for both their good and bad points.
“A more diverse shareholding base creates greater liquidity in the stock — that said, having strong, supportive shareholders has been very beneficial to Eagle,” he said.
Vogel pointed to Eagle’s acquisition last December of bulkers through an “overnight” equity issue, which was backstopped by GoldenTree.
