Dry cargo vessel owner and operator Navios Maritime Partners and tanker owner Navios Maritime Acquisition Corp. have unveiled their plan to merge into a standalone entity.
As informed, the transaction is expected to create the largest US publicly-listed shipping company, with over 140 vessels aggregating about 15 million deadweight tons operating in three segments through 15 different vessel types and serving more than 10 end markets.
“We are announcing a transformative transaction. The combined entity will be the largest U.S. publicly-listed shipping company in terms of vessel count, with 15 vessel types diversified across three segments, servicing more than 10 end markets,” Angeliki Frangou , Chairwoman and CEO, commented.
“About one-third of our fleet will be in each of the dry bulk, containership and tanker segment. We believe that this combination will result in a stronger, more resilient entity, mitigating sector specific cyclicality. This should enable us to capitalize on opportunities throughout the industry and provide even returns to our stakeholders across cycles.”
The deal will see Navios Acquisition merge with a subsidiary of Navios Partners and become a wholly-owned subsidiary of Navios Partners.
On 26 August, the duo announced a definitive transaction agreement providing for a combination of Navios Partners and Navios Acquisition in a transaction in which shareholders of Navios Acquisition will receive 0.1275 of a common unit of Navios Partners for each outstanding common share of Navios Acquisition.
All of Navios Acquisition’s outstanding 8.125% First Priority Ship Mortgage Notes, due on November 15, 2021, will be redeemed in accordance with their terms with the proceeds of a cash contribution from Navios Partners and newly arranged secured term loan financings.
The current value of the combined company’s vessels is estimated at $4.2 billion based upon the average of publicly available broker reports; the combined company will also have an enterprise value of approximately $2.25 billion.
With a $1.6 billion pipeline of contracted revenue coupled with about 47,634 available days in 2022, the combined fleet is well-positioned to take advantage of the healthy dry cargo markets as well as any future upturn in the tanker market, the two companies said.
The merger is expected to close in the fourth quarter of 2021, subject to customary closing conditions.
Earlier this year, Navios Partners completed the acquisition of container shipping company Navios Maritime Containers, with the latter surviving as a subsidiary of Navios Partners.