On October 29, 2014, DryShips, Inc. (DRYS) successfully offered 250 million shares of its common stock with a par value of $0.01 per share, at a price of $1.40 per share. As part of the offering, George Economou, the company’s chairman, president, and chief executive officer, purchased $80 million, or 57.1 million shares, of common stock at the public offering price. With this purchase, Economou increased his ownership in DryShips to 16.9%.
On October 29, 2014, DryShips signed definitive documentation for a senior secured credit facility with Nordea Bank for up to $170.0 million. This facility will be used to refinance existing debt under the company’s $325.0 million senior credit facility. The senior credit facility had a balance of $50.0 million as of October 31, 2014.
The Nordea facility has a five-year term and bears interest at LIBOR (London inter bank offered rate) plus a margin. It will be secured by the six vessels that currently secure the existing $325.0 million senior credit facility, as well as by three other currently unencumbered vessels.
In conjunction with this refinancing, the company entered into long-term chartering contracts with a major capesize operator that involves five vessels for an average period of five years, including purchase options.
On October 12, the company secured financing in the form of a $200 million-secured bridge loan facility from ABN AMRO.
DryShips CEO Economou said, “We are delighted to have achieved the refinancing of our convertible notes on Dec 1. Our recent successful equity offering raised $333.7 million in net proceeds for the company. This equity offering, credit facilities from Nordea Bank and ABN AMRO and the unsecured credit line of $120 million from Ocean Rig covers the $700 million due outstanding.”