Thursday, February 13, 2014

A Survey Of Shipping Preferred Shares

Last Monday, Diana Shipping Inc. (DSX) tapped the market to raise $60 million by issuing 2,400,000 million series B preferred shares. This is the fourth time this year that shipping companies have issued preferred shares as an alternative to common equity. Earlier this year, Costamare Inc. (CMRE), Navios Maritime Holdings Inc. (NM) and Seaspan Corp. (SSW) raised $100 million, $50 million and $125 million respectively.

This follows a very busy year last year, when Tsakos Energy Navigation Ltd. (TNP), Safe Bulkers Inc. (SB), Box Ships Inc. (TEU), and Costamare Inc. (CMRE), had raised in excess of $215 million in preferred shares.

Preferred shares are hybrid securities that share elements with both corporate debt and common equity. They offer a great alternative to raise equity without diluting common shareholders. Yield seeking investors may find the risk-reward profile of preferred shares more suitable than common shares.

For a complete survey of common characteristics and differences of shipping preferred shares, please continue reading the full article published on Seeking Alpha.

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