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Performance Shipping Buying Its First Two Tankers

Greece-based shipping company Performance Shipping has decided to purchase two Aframax tankers for USD 60 million.

The company has agreed to acquire two entities, which have signed contracts to buy the two 2011-built vessels from an unaffiliated third party seller.

As informed, the transaction was unanimously approved by the disinterested members of the board of directors of the company.

Specifically, Performance Shipping will acquire two entities affiliated with the company’s chairman and CEO, Symeon Palios, for an aggregate purchase price of USD 10 million, which will be paid in common shares of the company at a per share price of USD 1.05.

The purchase price of the two entities is equal to the deposit previously paid to the vessels’ seller by the affiliates of the company’s chairman. The balance of the purchase price payable under the contracts is expected to be funded through cash on hand and bank financing, according to the company.

The first vessel is expected to be delivered in the third quarter of this year and the second in the fourth quarter.

Commenting on the transaction, Palios said: “I am excited to be able to offer this attractive opportunity to purchase high-specification Aframax tankers to the company at what I believe is a favourable time in the tanker industry cycle.”

“The acquisition of these vessels represents an important step in the company’s diversification from the container industry into other areas of the shipping sector. The sale of these contracts for common shares of the company reflects my view that now is an attractive time to invest in the company as it starts to rebuild its fleet,” he added.

Following the closing of this transaction, the company will have 36,277,660 common shares and another 2,000 Series B-2 preferred shares issued and outstanding.

Upon completion of the above-mentioned entities’ acquisition, Performance Shipping will own four unencumbered containerships, two contracts to purchase two Aframax tanker vessels, for which USD 10 million have been paid as deposit, plus approximately USD 7 million of cash.

Earlier this year, the company, previously known as Diana Containerships, changed its name to Performance Shipping in an effort to diversify into more shipping segments.