Panamax unmasked

Shipbrokers appear to have pinned down the identity of the panamax bulker that Euroseas purchased earlier this week.
Aristides Pittas

Aristides Pittas

Yesterday, the diversified Greek owner told investors it acquired a panamax that was built in 2004 by a Japanese yard but did not provide any other details about the transaction.

Less than 24 hours later a leading sale-and-purchase broker identified the 76,500-dwt Million Trader II (built 2004) as the vessel in question.

The firm says an affiliate of Euroseas paid $21.5m for the vessel, which is approximately $1m higher than what the platform believes it to be worth in today’s market.

The owner’s chief executive, Aristides Pittas, said little about the transaction in a conference call with investors Friday morning but did note that the price tag was slightly more than $20m.

According to Clarksons and other market sources the bulker, which was constructed by Tsuneishi Zosen, is controlled by Nisshin Shipping Co of Japan and will likely change hands within the next three months.

Campaign will continue

Pittas, who was quick to praise management’s new relationship with Tennenbaum Capital, pointed out that his company will continue to pursue fleet expansion in the months ahead.

He noted that Euroseas intends to focus on the acquisition of bulkers while containership purchases will likely be left to Euromar, its joint venture with Eton Park and Rhone Capital.

Pittas said his company recently committed to ploughing another $5m into the partnership and indicated the alliance now has enough cash on hand to pounce on up to four more vessels.

Pittas issues lacklustre rate forecast

Going forward the executive said he expects freight rates in the dry-bulk segment to improve in 2014 and 2015 but admitted he doesn’t believe it will be a dramatic rebound.

“We expect demand prospects for containerships to also improve in 2014 and 2015, but demand is still shaky in view of the fragile economic environment,” Pittas continued.

“With no new incremental deliveries expected for 2014 and 2015 we expect the supply/demand balance slightly in favour of demand and the modest improvement of rates over the next two years.”

In response to a question about chartering strategy Pittas said Euroseas will continue to focus on trading tonnage in the spot market but admitted it might book period deals if rates “hit very high levels”, which he does not expect to see anytime soon.

“As long as we feel that we are on a rising market we will be doing short-term charters,” he said. “Of course if we reach at very high levels, then we might conservatively book in some long periods but we're still far from that even in the drybulk sector.”

Euroseas Ltd.
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