Golden Ocean to add 16 ships in all-share deal

MARCH 15, 2017 — Golden Ocean Group Ltd. (NASDAQ/OSE: GOGL) has successfully raised around $60 million through a private placement of 8,607,800 New Shares. It says that the private placement received very strong interest from large institutional investors and was multiple times subscribed.

Golden Ocean announced the private placement in connection with an all-share deal to acquire the entire Quintana Shipping fleet of 14 modern dry bulk vessels along with two ice class Panamax vessels from subsidiaries of Seatankers, an affiliate of John Fredriksen's Hemen Holding Ltd. Hemen is Golden Ocean's largest shareholder.

Golden Ocean will acquire Quintana's 14 vessel fleet and assume the fleet's corresponding debt of $262.7 million in consideration for 14.5 million shares of Golden Ocean. Golden Ocean has agreed to a $17.4 million down payment of the debt associated with the fleet in order to obtain no fixed debt repayments and soft covenants through June 2019. A cash sweep mechanism will be in place for excess cash generated by the fleet. The fleet consists of 6 Capesize vessels and 8 Kamsarmax/Panamax vessels, mainly built in Japan and Korea.

Additionally, Golden Ocean will acquire two 2017-built ice class Panamax vessels from affiliates of Hemen in consideration for 3.3 million shares of the company to fund the equity portion of the acquisition. Hemen will issue a seller credit of $22.5 million that matures in June 2019, with no fixed amortization.

Golden Ocean said today that on completion of the offering and the vessel purchase transactions, Hemen will emerge with 37.65% of the company's shares and votes, while Quintana would have 11%, making it the company's second largest shareholder.

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