A True Believer Consolidates and Does Right by His Shareholders

On Monday, George Economou announced a major strategic expansion by DryShips Inc. (“DryShips”) in both its bulk and offshore businesses. First, the company acquired the equity interests, from entities controlled by Cardiff Marine Inc., in nine Capesize bulkcarriers, including five newbuildings for $690 million payable in the form of 19.4 million newly issued shares ($35.50 per share) of Dryships common stock increasing the number of shares to 63 million. In addition, the company will assume $216.3 million of existing debt and $262 in remaining shipyard installments. The latter will be funded by debt facilities in place except for $16 million that will be funded by cash flow. The implied aggregate value of the purchase is estimated at approximately $1.2 billion or approximately $130 million per vessel.

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