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Dryships to sell tanker fleet to Economou, nixes Tankships IPO

Dryships to sell tanker fleet to Economou, nixes Tankships IPO
Dryships is selling its tanker fleet to George Economou shelving the planned initial public offering (IPO) of Tankships.

New York-listed Dryships said it was selling four suezmax tankers to undisclosed entities owned by its chairman and ceo Economou. The four suezmaxes will have an enbloc price of $245m.

It also announced the potential sale of its six aframaxes to Economou controlled companies for $245m enbloc, with confirmation of the sale by 30 June this year at the latest.

The move to sell the tanker scotches a planned IPO of the tanker under the name Tankships Investment Holdings announced in January this year.

“Ultimately, we believe the sale of the tankers as opposed to an initial public offering of our tanker fleet is the best way to immediately realize maximum value,” said Ziad Nakhleh, cfo of Dryships.

“These transactions increase our cash liquidity and we believe they should release the selling pressure on both DryShips and Ocean Rig share prices, as we demonstrate that DryShips has many options other than the sale of undervalued Ocean Rig shares.”

Proceeds from the suezmax sale would generate $125m in free cash which will be used to repay part of a bridging loan with ABN AMRO, which stands at $185m. The potential sale of the aframax fleet would generate $150m in further free cash, which could be used to repay the remaining amount of the bridging loan and for general corporate purposes.