Seanergy Maritime Holdings Corp. (NASDAQ: SHIP) (NASDAQ: SHIPW) announced that, due to market conditions, the company's Board of Directors has determined to terminate the memorandum of agreement for the intended acquisition of a 2009 Capesize vessel as described in the Company's prospectus dated January 28, 2010.
"The decision of the Board safeguards the long-term interests of our shareholders," explained Dale Ploughman, Chief Executive Officer of the Company. "Our initial intention, as expressed in the prospectus, was to use the net proceeds of our recent offering for this purchase. The purchase price we agreed to pay for this vessel reflected the above-market charterhire that we expected to receive from the charter currently in place. However, after closely analyzing unforeseen very recent developments in the world economy, we believe that these developments, and in particular the announcement by the Chinese government to restrict Chinese banks' lending activities, would likely adversely affect our ability to realize the full benefits from this purchase and subject us to prolonged and undue market and credit risk given the vessel's high price. Therefore, the Board determined that it would be in the best interests of the Company and all of its shareholders to terminate the agreement for this vessel. Fortunately, we were able to do so prior to placing a deposit for the vessel."
"We are committed to our stated goal of using the net proceeds of the offering, which are currently held in an interest-bearing bank account, to expand our fleet and we are focusing our resources on identifying vessel(s) with a view to maximizing benefits to the Company, as quickly as possible," Ploughman added.