Pacific Basin Acquisition Reflects Appeal of Handysize Assets

Pacific Basin Handysize

Hong Kong-based dry bulk owner, Pacific Basin Shipping Limited, announced on Tuesday that it had signed a conditional agreement to acquire four secondhand or newbuilding bulk carriers at a com­bined value of US$ 88.5m. Fifty percent of the pur­chase would be funded by equity, said the owner. All four of the vessels—two Supramaxes and two Han­dysizes—are what would generally be called Handy bulk, comprising tonnage in the range of 64,000 dwt to 37,000 dwt. The largest, a 64,000 dwt, 2018-built Supramax would be purchased for US$ 28m and delivered in the middle of the year. The second Supramax, at 58,000 dwt, was built in 2010, pur­chased for US$ 15.5m and set for delivery in early 2019. The remaining two Handysizes are both of 37,000 dwt tonnage and log-fitted, one built in 2015 and one a 2018 newbuilding, both ships to be delivered in Q4 of this year, purchased at US$ 20.5m and US$ 24.5m, respectively. The three-year-old Handysize was already under long-term TC, which Pacific Basin said would replace its charter cost with ‘significantly’ lower operating costs. Earn­ings from new shares to be issued by the company would be applied to the purchase, said Pacific Basin. CEO Mats Berglund said the secondhand ships are consistent with the company’s target of acquiring good quality vessels at historically low prices. Pacific Basin, with an impressive fleet of 111 ships, is clear­ly no stranger to the dry bulk market. This purchase reflects a smart investment in arguably the best bulk carrier sector to acquire at the moment. Indeed, shipping market players say, anecdotally, that Han­dysizes are the best bang-for-buck in today’s S&P market. A recent poll by Splash­247 and MarPoll found, when presented with four promising vessel types—Handysizes, chemical tankers, small (sub 3,000 TEU) containerships and LPG carriers—nearly half of the over 300 respondents (43%) selec­ted the Handysize ship as the best asset play in 2018.

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