Since last year, the Greek shipping company Diana Shipping has been trying to take over the US firm Genco Shipping & Trading – without success. After a series of increasingly aggressive bids, the takeover is now definitively off the table.
Over a period of nine months, Diana had repeatedly put forward new offers, all of which had been rejected by Genco. Genco has now made a demand equivalent to a valuation of $36.91 per share, which is significantly higher than Diana’s latest offer. This appears to bring the takeover process to an end.
Genco’s demand is made up as follows: $27.50 per share, a further $2 per share as compensation for the projected dividends for the third and fourth quarters, and three Diana shares for every Genco share. Based on Diana’s closing price on 13 August ($2.47), the total package would have secured Genco shareholders a stake of around 47 per cent in the merged company.
Previously, Diana had offered $24.80 per share plus one Diana share, which had been valued at $2.54 at the time. Genco’s counter-offer is so significantly higher than this figure that Diana’s chief executive, Semiramis Paliou, described it as “outrageous” and said that no credible prospective buyer would accept this price.
The battle for the takeover of Genco began last November with an offer of $20.60. Since then, Diana has raised the purchase price several times and has attempted to gain voting rights to control Genco’s board of directors through its own nominations. Diana holds 14 per cent of Genco’s shares, making it the largest shareholder.
Only recently, the shipping company Star Bulk Carriers withdrew from its plans to acquire 16 bulk carriers from Genco. Petros Pappas, the company’s CEO, had cited the lack of progress in the Genco negotiations as the reason for the withdrawal.
