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Kalani has been about 20% of the trade each day. It would be nice if they were done, but it doesn't seem likely - not today any way. Maybe we will get a 6k after hours today and will be better informed.
dave - I would agree. I don't believe they are done yet, but they are getting very close. Based on the ~70 million shares traded since last monday and using an average Kalani sale price of $2.15, my guess is they have somewhere between $35-$40 million left. At the pace shares are trading , they could make it through the remainder by as early as Thursday.
Nearly 70 million shares traded between Friday and now. The balance of the Kalani distribution is likely around $45 million at this point. They could very easily wrap it up this week.
I am not so sure about that. Could be proven wrong of course, but the amount of shares that are being traded and dollar volume could just as easily mean the dilution is coming to an end. Today could easily surpass Friday's volume.
Wasn't that what happened on Friday?
By the end of today Kalani may have sold $20+ million. I believe they sold at least $15 million last week. It would seem as though they are on track to possibly wrap this up this week?
I think it is much less than that given the trading Friday and today.
Nearly 26 million shares traded already this morning. I am thinking Kalani sold roughyl $8-$10 million so far today.
My guess is Kalani has less than $60 million left to distribute. At current pace, this could be done as early as end of the week.
$200 million revolver from GE and recent $150 million commercial loan consortium. $37.5 drawn down from commercial loan so far.
Do you know nothing about GE? Kalani will be selling as fast as they can this morning.
No news in no news. DRYS simply hasn't provided an update on where the outstanding is currently. NAV as reported on 7/21 is $473.7 million with ~5.2 million shares outstanding. Considering how many shares were traded on Friday, it would be silly to think Kalani wasn't part of that mix. They have been roughly 20-25% of the trade every day for months. Friday probably wasn't any different, which would imply they sold some thing in the neighborhood of 7 million shares.
Just guessing then, and that is all anyone can do at the moment, with 12 million outstanding, the NAV/share = $40. The very next question to ask yourself is how many shares will get printed and sold today?
paused again at 3:26
I take it to mean they can't find enough shares to cover?
DRYS "paused due to volatility"
3x outstanding traded?
DRYS has a $200 million revolving line of credit from GE. It's maxed out at this point. The $37.5 million was pulled down from the $150 million dollar credit facility they negotiated I believe in May. The money was used to pay for a new vessel.
None of this is a red flag at all and is just a shipping company conducting its business.
The red flags have been the dilution and reverse splits.
Agreed. He is interested in completing the Kalani transaction though. The current course will quickly get DRYS to a point where the rinse-and-repeat strategy of printing shares, dumping, and reverse splits simply don't work anymore. I have been predicting at least one more reverse split if things continue as they have. What I didn't expect though was the pps to be cut immediately in half on a reverse. At this price, GE won't be able to sell very many shares before the pps sinks below a dollar again. This strategy has gotten to point where it really won't work much longer. So what's his next option? It would make sense to let the pps rise for a while before hammering away with new paper.
Seriously? Shipping typically has 50-60% debt to equity. DRYS is under leveraged by comparison.
Don't disagree with that. Right now I would go further and describe it as a few minute trade.
I doubt the Marshall Islands court will rule the way you would like. That won't happen for a few weeks either. The US courts may have a different finding, but that could be years before anyone sees a final answer. it's all about today that matters.
DryShips Inc. Reports Updated Key Financial Information Post Reverse Stock Split
8:45 AM ET 7/21/17 | Dow Jones
DryShips Inc. Reports Updated Key Financial Information Post Reverse Stock Split
ATHENS, GREECE--(Marketwired - Jul 21, 2017) - DryShips Inc. (NASDAQ: DRYS), or DryShips or the Company, a diversified owner of ocean going cargo vessels, today reports its updated key financial information giving effect to the reverse stock split on July 21, 2017:
Key Financial Information as of July 21, 2017, post reverse stock split:
-- Cash and cash equivalents: approximately $58.6 million (or $11.30 per
share)
-- Book value of vessels, including advances: approximately $652.6 million
(or $125.86 per share)
-- Debt outstanding balance: approximately $237.5 million
-- Number of Shares Outstanding: 5,185,153
About DryShips Inc.
The Company is a diversified owner of ocean going cargo vessels that operate worldwide. The Company owns a fleet of (i) 13 Panamax drybulk vessels; (ii) 4 Newcastlemax drybulk vessels; (iii) 5 Kamsarmax drybulk vessels; (iv) 1 Very Large Crude Carrier; (v) 2 Aframax tankers; (vi) 1 Suezmax tanker; (vii) 4 Very Large Gas Carriers, 3 of which are expected to be delivered in September October and December of 2017; and (viii) 6 offshore support vessels, comprising 2 platform supply and 4 oil spill recovery vessels.
DryShips' common stock is listed on the NASDAQ Capital Market where it trades under the symbol "DRYS."
Visit the Company's website at www.dryships.com
Forward-Looking Statement
Matters discussed in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with such safe harbor legislation.
Forward-looking statements reflect the Company's current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.
The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in the Company's records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the Company's control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.
Important factors that, in the Company's view, could cause actual results to differ materially from those discussed in the forward-looking statements include the factors related to the strength of world economies and currencies, general market conditions, including changes in charter rates, utilization of vessels and vessel values, failure of a seller or shipyard to deliver one or more vessels, failure of a buyer to accept delivery of a vessel, the Company's inability to procure acquisition financing, default by one or more charterers of the Company's ships, changes in demand for drybulk or LPG commodities, changes in demand that may affect attitudes of time charterers, scheduled and unscheduled drydockings, changes in the Company's voyage and operating expenses, including bunker prices, dry-docking and insurance costs, changes in governmental rules and regulations, changes in the Company's relationships with the lenders under its debt agreements, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents, international hostilities and political events or acts by terrorists.
Risks and uncertainties are further described in reports filed by DryShips Inc. with the Securities and Exchange Commission, including the Company's most recently filed Annual Report on Form 20-F. The Company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law. If one or more forward-looking statements are updated, no inference should be drawn that additional updates will be made.
Investor Relations / Media:
Nicolas Bornozis
Capital Link, Inc. (New York)
Tel. 212-661-7566
E-mail: dryships@capitallink.com
(MORE TO FOLLOW) Dow Jones Newswires
July 21, 2017 08:45 ET (12:45 GMT)
This has gotten beyond stupid at this point. The current NAV is roughly $91/share. If GE took his foot off the accelerator for a week or 2, the pps would likely move up quickly to around that value. 1-2 million new shares and the Kalani dilution would be done. A lot less pain and thought and all it would take is even one thought on GE's part.
If only hopes and dreams were facts.
25% of the current outstanding has already traded. I doubt GE/Kalani are in this mix. They typically get busy around 10:00 or after.
$1.49 ask. It seems the market is sending GE a very strong message about how he is ignoring his fiduciary responsibility.
The dividend payout was almost as much as DRYS market cap.
OUCH! $3 start tomorrow? GE has really killed the pps again. It will be interesting to find out how much he collected this week at shareholder expense.
Maybe. $77 million annual ebitda; $25 million net revenues? That's not enough cash left to replace ships as they reach their end of service. Don't see it reaching multiple billions in value in the foreseeable future.
Unclear how many additional shares will be printed by GE before the dilution is over. That makes it very difficult to predict what the share value might be even by the end of next month. Is this a $4 dollar stock or $40? And then only after the dilution ends. Anyone buying and holding now is highly likely to loose 75-80% of their investment simply through dilution and that doesn't take into account another possible RS.
ash - agree that BK is just silly talk. Clearly there is confusion between share price and company financial health.
By the way, while the $77 million you have reported out is accurate according to a DRYS press release. However, they suggested it is an assumption on a per annum period. They weren't any more specific but it was presumably for 2018. I am not aware of any discussion regarding the second half of this year.
"Indicative Fleet Earnings Capacity
On an annual basis, assuming all the vessels we have agreed to acquire have been delivered, that vessels are fully utilized and earn $16,000 per day for Newcastlemaxes, $12,000 per day for Kamsarmaxes, $10,000 per
day for Panamaxes, $18,000 per day for Aframaxes, $25,000 per day for Suezmaxes and $30,000 per day for very large crude carriers (“VLCCs”), and the rest of the vessels in the Company’s fleet that are employed
under time charters will earn their respective fixed rates, the Company estimates for indicative purposes that its active fleet (i.e. excluding laid up vessels in our offshore support fleet) will generate EBITDA(1) of approximately $77.0 million. "
http://dryships.irwebpage.com/press/drys051017.pdf
Charlie - The facility is located about 600 miles north of Toronto. I would expect some press to come from them along with the financing group. I will post anything that gets published or provide more details when the deal gets done. Considering the price tag is $65 million and the employment it will bring to the area, it should be big news.
Shoulda, woulda, coulda. The only thing anyone can do is to make their trades based on the current known facts. GE being a scumbag is well known and documented. With that said, he has clearly and repeatedly told everyone what his plan is. Print more shares and sell them. His only goal is to get the money. So whatever he can sell shares for is OK by him. Like it or don't makes no difference. The market place is reacting to what is known. More shares are being dumped and will continue to be dumped until the "Kalani" deal is wrapped up. The only thing that will cut the time frame down on completing the dilution is if GE buys a large block of shares on the cheap, which I believe he will do. After all of the damage done and being a scumbag, it makes perfect sense he would jump in at the end knowing the damage was done and the market reaction would be to violently move the pps up.
dave - probably right. If this continues down the same path anyone buying today is about to lose 75-80% value over the next 4 weeks.
In roughly a month GE distributed 30+ million shares worth approximately $44 million. I expect the next month will go about the same as the past month and GE will distribute about the same number of shares and the outstanding will be ~40 million by 8/22. The Kalani balance at that point will likely be around $25-$30 million when I expect GE will buy the balance. Maybe that will be new money or a transfer out of the revolver for common shares. Either way, given where the pps will likely be trading at that point, GE will end up being the largest shareholder in DRYS once again.
This was very predictable and yet there seems to be a lot of surprise about the RS.
The 6k's would differ
Maybe. GE's preferred shares have been diluted along with common. His total voting shares are far less than total common currently outstanding. And the spread increases daily now as the dilution continues.
not sure why anyone would do that. Just buy as many shares as they could over a few weeks and then tender an offer. The very least thing that happens is the shares run up in value the "buyer" simply dumps and makes a big profit.
Sam - It has always been surprising to me how long it takes to put these deals together. I have been speaking directly to the principals since January and they honestly believed they had everything sewn up then. A number of financing groups later and they finally have something signed. Assuming this actually takes place in September, it will be a very significant event for FASC too. The fact is a large, working project has always been needed in order to validate the KDS within that larger scope.
There are several other much larger projects coming through the pipeline that will have an even larger impact on FASC. Nothing happens until it happens, of course, but I feel things are moving in a really good way for FASC.
Most enterprises are valued by 4 or 5 times their NAV when they are developing. Basically, there are insufficient revenues to apply a multiplier. Next year will be a little bit different. Presumably there will be positive revenues that can be used with at least a 15x time revenues to determine a pps. Up to now there have been nothing but negative revenues and the addition of new ships in the past 2 quarters. No history to have a clear picture of revenues yet. That is unless you are willing to take GE at his word.
Q3 should be relatively good for DRYS the business. Most of their ships will have been delivered. The VLGCs will be delivered in Sept, Oct, and Dec. The real impact from those deliveries should be felt starting with Q3 and going forward. Drybulk is improving; OSVR is mostly laid up and servicing an almost dead customer base so they are negative to the bottom line.
I was expecting BWS to have an impact starting Q3, but shippers dodged that bullet. BWS has been moved out starting in 2 years. Scrapping would have picked up significantly as owners moved to avoid the cost to older ships. This would have taken tonnage out of the market and had a positive effect on rates. In the mean time, newer ships have an advantage over older ships and are generally selected first. So DRYS should have a competitive advantage with the exception of their Panamax fleet, which is older.