Golden Ocean could sell final ultramaxes at 'right price'

Last two ultras could also go as shipowner focuses on segments where it has scale, says Vartdal.

Golden Ocean could exit the ultramax market entirely should the right offer arrive for its remaining two vessels in the sector, its chief executive says.

John Fredriksen’s Golden Ocean this morning announced the $142.5m sale of six of its eight ultramaxes with Scorpio Bulkers believed to be the buyer.

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Birgitte Ringstad Vartdal, chief executive of Golden Ocean Management, tells TradeWinds the company has kept three of the ships un-financed and the offer was a good move to free up “significant cash”.

“Golden Ocean operated historically in the cape and panamax segments and we would like to focus our efforts where we have commercial scale,” she explained.

“We have not yet decided on what to do with the remaining [ultramax] vessels but at the right price you could see us also sell those.

“We always look at opportunities and will of course continue to do that. At the moment we are happy with the increased financial flexibility this gives us which improves our options going forward.”

Golden Ocean was already a force in the capesize market having taken on the ships Fredriksen first contracted via Frontline 2012.

Its takeover of Quintana Shipping in a cash and stock move earlier this year added six more capes alongside eight panamax and post-panamax vessels.

Following the Quintana deal Golden Ocean had cash and cash equivalents of $127m.

Anders Karlsen of Danske Bank said in a report earlier this month that Golden Ocean is positioned to reap the benefits of an improved dry cargo market through increased asset values and improved earnings.

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“Over the past six months, we have seen a positive shift in asset values on the back of expectations of improved earnings. More recently, there has also been a lift in spot and term rates,” he said.

The value of a five-year old capesize is presently around the same level as we saw in mid-2015, whilst one-year charter rates are above the levels seen in 2015, indicating that there is further upside in values.”

Karlsen expects Golden Ocean to return to the black in 2018 with a profit of $58m, rising to $145m in 2019.

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