International Shipholding orders 3 bulk ships
Mobile, Ala.-based International Shipholding Corp. said Thursday it has agreed to purchase three handy-size dry bulk ships at Hyundai Mipo Dockyard Co. Ltd.
The ships are to be delivered between December 2010 and February 2011. The company also has an option to purchase a fourth ship.
'We believe these quality, high specification newbuilding vessels will provide important long-term strategic benefits to International Shipholding Corp., positioning the company to increase both its diversified fleet and earnings potential during a time when we continue to distribute dividends to our shareholders,” said Niels M. Johnsen, chairman and chief executive officer. “Consistent with our operating strategy, we intend to employ the new vessels on medium to long-term contracts.'
The estimated total delivered cost for the three ships is about $90 million. Upon signing the agreement for the three vessels, International Shipholding paid an initial installment of $17 million using available cash. Future installments will be paid over the construction period with the final installment due upon delivery of each vessel. The company plans to fund the remaining installments through a combination of borrowings under its revolving credit facility, available cash and long-term financing.