Jan. 29 (Bloomberg) -- Excel Maritime Carriers Ltd. agreed to buy larger rival Quintana Maritime Ltd. for $2.45 billion, including debt, to more than triple its fleet size, which carries commodities including ore and coal.

Excel will pay $13 in cash and 0.4084 share for each Quintana share. That equals about $26.48 a share based on yesterday's closing price, Hamilton, Bermuda-based Excel said today in a statement. The price is 57 percent above Quintana's close yesterday.

Excel Chairman Gabriel Panayotides said on a conference call today that the purchase puts Excel ``another step closer'' to his ``vision of creating a truly global full-service dry-bulk carrier.'' Quintana operates 29 ships and is awaiting delivery of eight more over the next two years, which will increase its fleet capacity by 55 percent.

``From a strategic standpoint, we like it,'' said Doug Mavrinac, a Houston-based Jeffries & Co. analyst who has a ``buy'' rating on both companies. ``It increases the size of Excel's fleet significantly, lowers its average age, and it increases time-charter coverage.''

The age of Excel's fleet will fall to an average age of 8.2 years from 12.9 years. Newer ships tend to win higher shipping, or time-charter, rates. Total capacity will increase to 3.7 million deadweight tons from 1.07 million deadweight tons.

Rising Shares

Quintana, based in Glyfada, Greece, rose $5.13, or 30 percent, to $22.02 in Nasdaq stock market composite trading. Excel fell $1.22, or 3.7 percent, to $31.78 in New York Stock Exchange trading. The 13-member Bloomberg Dry Ships Index was down 26 percent so far this year, before today, because of a decline in shipping rates.

The purchase will make the combined entity the fourth- largest Panamax-size carrier company in the world, according to Lloyd's Register-Fairplay. Panamax carriers usually haul 75,000- ton cargoes. Quintana had $626 million in debt as of Sept. 30.

Quintana specializes in long-term charters while Excel has booked more on the spot market with short-term contracts. Quintana said last year its fleet was 90 percent booked for 2008, 80 percent in 2009 and 70 percent in 2010. Quintana's customers include BHP Billiton Plc, the world's biggest mining company, and Cargill Inc., the largest U.S. agricultural company.

The addition of Quintana's eight Capesize-class ships, which will be delivered over the next couple of years, will ``serve as the growth engine of the company,'' Stamatis Molaris, Quintana's chief executive, said on the conference call. Molaris will become CEO of the combined company.

Commodity Carriers

The purchase sent other dry-bulk carriers higher. Diana Shipping Inc. rose 9.1 percent to $26.66, while DryShips Inc. gained 5.3 percent to $62.44. Eagle Bulk Shipping Inc. climbed 5.1 percent to $23.25 and Genco Shipping & Trading jumped 13 percent to $45.43.

Bulk-shipping rates have slumped 49 percent from a record in November amid delays in annual price talks between Chinese steelmakers and iron-ore producers and concern that the U.S. and Chinese economies are slowing. Dry-bulk companies have benefited by strong commodity demand from China and India, among other countries.

The Baltic Dry Index, an overall measure of commodity- shipping costs on different routes and ship sizes, has fallen 37 percent this year and was down 1.4 percent today.

The purchase could trigger other acquisitions within the industry, Mavrinac said. ``You can see continued consolidation,'' he said. ``More of the consolidation may be public companies buying private assets.''

Boards Approve

The acquisition has been agreed to by the boards of both companies. Excel said the total value of the transaction was $2.45 billion, which includes Quintana debt. The purchase could close in the second quarter.

``This is a highly attractive offer for Quintana,'' Quintana's Molaris said on the call. Excel secured $1.4 billion in financing for the purchase.

Natasha Boyden, a Cantor Fitzgerald analyst, said in a note to investors that the acquisition price was ``reasonable'' for Quintana's assets, though she had concerns the purchase involved too much debt. She has a ``buy'' rating on Excel and a ``hold'' on Quintana.

Iron ore supplies slumped after Cia. Vale do Rio Doce, the world's biggest producer, and Rio Tinto Group, the second- largest exporter, said shipments were disrupted. Panamax rates have fallen 31 percent this year alone.

Financial Advisers

Quintana in October said it hired financial advisers, suggesting it may put itself up for sale. On Jan. 8, TradeWinds magazine reported the company accepted a $27-per-share offer from Excel.

Quintana last week said it would remain an independent company after not receiving offers that were financially attractive enough.

The $26.48-a-share purchase price would be changed if the average closing price of Excel shares exceeds $45 a share in the 15 trading days prior to the acquisition's completion, Excel said.

The combined company will operate 55 ships, with almost 5.2 million tons of dead-weight tonnage.

Quintana sought financial advice from Citigroup Inc., the world's third-biggest adviser on mergers last year, and legal counsel from Morgan, Lewis & Bockius LLP. Excel used Deutsche Bank AG and law firms White & Case LLP and Gr. J. Timagenis Law Office.

To contact the reporter on this story: Todd Zeranski in New York at tzeranski@bloomberg.net

Last Updated: January 29, 2008 16:59 EST