Excel Cancels Purchase of Supramax, Pays $14.7 Million Fee

Excel Maritime Carriers Ltd. (EXM), a transporter of raw commodities such as iron ore and coal, canceled an agreement to buy a Supramax-class ship and will pay a fee of $14.7 million in cash and stock.

Excel will pay $7.25 million and issue 1.1 million company shares to the sellers to terminate purchase of the 2002-built Medi Cebu. Excel, based in Athens, retained the exclusive option to buy the ship for $25.7 million until the end of the year, according to a Market Wire statement.

Shipowners including Genco Shipping & Trading Ltd. (GNK) and DryShips Inc. (DRYS) are canceling ship orders to preserve cash as freight rates suffer from a global economic slowdown. The Baltic Dry Index, a measure of shipping costs for commodities, fell a record 92 percent last year.

Excel fell 70 cents, or 9.4 percent, to $6.76 today. The shares have fallen 77 percent in the past year.

Separately, Excel said it took delivery of a new Capesize ship, the Sandra, on Dec. 26. The vessel is under a five-year time-charter agreement at $39,000 per day.

Supramax ships typically have capacities of between 50,000 and 60,000 deadweight tons. A Capesize is capable of moving 175,000 tons of cargo.

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

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.