Star Bulk Carriers Corp. (NASDAQ: SBLK) announced that it has signed a contract with ship builder Hanjin to build a Capesize vessel of 180,000 deadweight tons, at a price of $53.5m with expected delivery in September 2011. The company has also entered into a ten year time charter agreement for the vessel with STX Panocean at a gross daily hire of $24,750. Star Bulk has also received offers for debt financing of up to 70% of the vessel's price at favorable financing cost/terms and expects to complete the financing within the second quarter of 2010. The company has not yet decided the ratio of Company cash to senior debt that it will utilize in this acquisition.
Akis Tsirigakis, President and CEO of Star Bulk, commented: "We are pleased to grow organically with the acquisition of a newbuilding Capesize vessel from a high quality ship builder. This deal involved the challenge of putting all required elements together simultaneously, namely, quality builder, competitive price, good contracted employment, quality counterparty and competitive financing. The vessel contract was achieved at a very favorable price considering recent similar newbuildings. We are also pleased that our senior debt lenders continue to support our acquisition plans via offers of favorable financing terms. Currently, our fleet is contracted for 92% of 2010 and 58% of 2011 operating days, amongst the highest contract coverage in the industry, providing future earnings visibility. We continue to focus on enhancing shareholder value, supported by our strong balance sheet and liquidity."