Corporate Contact:
Ioannis Zafirakis
Director, Executive Vice-President
and Secretary
Telephone: +
30-210-9470100
Email: izafirakis@dianashippinginc.com
For Immediate
Release
Investor and Media
Relations:
Edward Nebb
Comm-Counsellors, LLC
Telephone: +
1-203-972-8350
Email: enebb@optonline.net
DIANA
SHIPPING INC. ANNOUNCES AGREEMENT TO ACQUIRE
OWNER
OF A CAPESIZE NEWBUILDING VESSEL
ATHENS,
GREECE April 13, 2009 – Diana Shipping Inc. (NYSE: DSX), a global shipping
company specializing in the transportation of dry bulk cargoes (“Diana”), today
announced that it has executed an agreement with a related party to acquire a
single purpose company, Gala Properties Inc., that has a contract with China
Shipbuilding Trading Company, Limited and Shanghai Jiangnan-Changxing
Shipbuilding Co., Ltd for the construction of a 177,000 dwt Capesize dry bulk
carrier, identified as Hull No. H1138, with a contract price of $60.2 million.
The seller is a company controlled by the two daughters of Diana’s Chairman and
Chief Executive Officer, Mr. Simeon Palios.
As a
result of the transactions described herein, Diana expects to acquire the owner
of a newbuilding Capesize dry bulk carrier with an attractive time charter, in
exchange for Diana’s interest in a vessel with identical specifications and
contract price. The incremental cost to Diana (excluding legal and
other expenses associated with the transactions) will be approximately $15
million paid to the sellers.
Gala
Properties Inc. has time chartered Hull No. H1138 to Jiangsu Shagang Group Co.
(“Shagang”) or its nominee (with performance guaranteed by Shagang), at a gross
charter hire rate of $55,000 per day for a period of a minimum of fifty-nine
(59) months and a maximum of sixty-two (62) months, commencing upon delivery of
the vessel from the shipbuilders. This employment is anticipated to generate
approximately $97 million of gross revenues for the minimum scheduled period of
the charter. Diana expects this vessel to be delivered to it, and the charter to
commence, in November 2009.
In
exchange for this acquisition, Diana will transfer to the seller its ownership
interest in Eniwetok Shipping Company Inc. (“Eniwetok”), a wholly owned
subsidiary of Diana. Eniwetok previously contracted with the same
shipbuilders for the construction of a separate 177,000 dwt Capesize dry bulk
carrier, identified as Hull No. H1108, for the contract price of $60.2 million,
with a scheduled delivery date of June 30, 2010.
The
closing of these transactions is subject to the completion of certain
transactions by and among the parties to the shipbuilding contracts and
necessary financing arrangements. Diana expects the closing to take place in May
2009.
The
President of Diana Shipping Inc., Anastassis Margaronis, commented:
“We are
very proud to announce this transaction. After extensive negotiations, as a
result of these transactions, we expect to own an entity with a Capesize vessel
time chartered to a first class charterer at an attractive daily charter hire
rate arranged back in June 2008. We believe this latest transaction
should further improve the visibility of the Company’s cash flow over the next
five (5) years and reflects our determination to execute profitable
deals during these challenging times while maintaining our strong balance
sheet. We have also obtained an assurance by the shipbuilders that
they will use their best efforts to deliver to us another sister ship that we
have previously contracted to acquire, Hull No. H1107, by March 2010, well in
advance of its original scheduled delivery date of April 30, 2010. As
we have previously announced, that vessel is already time chartered to Nippon
Yusen Kaisha for $48,000 per day for minimum fifty-eight (58) to maximum
sixty-two (62) month period, commencing upon its delivery to us from the
shipbuilders.”
About
the Company
Diana
Shipping Inc. is a global provider of shipping transportation services. The
Company specializes in transporting dry bulk cargoes, including such commodities
as iron ore, coal, grain and other materials along worldwide shipping
routes.
Cautionary
Statement Regarding Forward-Looking Statements
Matters
discussed in this press release may constitute forward-looking
statements. The Private Securities Litigation Reform Act of 1995
provides safe harbor protections for forward-looking statements in order to
encourage companies to provide prospective information about their
business. Forward-looking statements include statements concerning
plans, objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements, which are other than statements of
historical facts.
The
Company desires to take advantage of the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and is including this cautionary
statement in connection with this safe harbor legislation. The words "believe,"
"anticipate," "intends," "estimate," "forecast," "project," "plan," "potential,"
"may," "should," "expect," "pending" and similar expressions identify
forward-looking statements.
The
forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions,
including without limitation, our management's examination of historical
operating trends, data contained in our records and other data available from
third parties. Although we believe that these assumptions were
reasonable when made, because these assumptions are inherently subject to
significant uncertainties and contingencies which are difficult or impossible to
predict and are beyond our control, we cannot assure you that we will achieve or
accomplish these expectations, beliefs or projections.
In
addition to these important factors, other important factors that, in our view,
could cause actual results to differ materially from those discussed in the
forward-looking statements include the strength of world economies and
currencies, general market conditions, including fluctuations in charter rates
and vessel values, changes in demand for dry bulk shipping capacity, changes in
our operating expenses, including bunker prices, drydocking and insurance costs,
the market for our vessels, availability of financing and refinancing, changes
in governmental rules and regulations or actions taken by regulatory
authorities, potential liability from pending or future litigation, general
domestic and international political conditions, potential disruption of
shipping routes due to accidents or political events, vessels breakdowns and
instances of off-hires and other factors. Please see our filings with
the Securities and Exchange Commission for a more complete discussion of these
and other risks and uncertainties.
# # #