Diamond S. Shipping enters Wall Street

By Christos Colonas 

On March 28 the stock of the new corporation, Diamond S. Shipping Inc, successfully entered the New York Stock Exchange. Its stock started trading at USD 11.00.

Diamond is a spin-off corporation of Capital Product Partners LP (Nasdaq: CPLP), in which Evangelos Marinakis holds interests, DSS Holdings  LP and other institutional investors, such China Investment Corp (a Chinese sovereign wealth fund), First Reserve Management and CarVal Investors (the investment arm of Cargill).

After a year and a half of negotiations, one of the biggest mergers in the global shipping industry was concluded, by combining the fleets of CPLP and DSS, with a total value of USD 1.65 billion. It is the biggest shipping industry merger ever concluded by a Greek ship-owner.

This deal created the third largest publicly listed owner and operator of crude oil and oil-product tankers in the world and the fifth largest publicly listed tankers corporation in terms of carry capacity with 68 ships valued at USD 1.65 billion and with a combined Net Asset Value of USD 700 million.

“The CPLP merger provides us the scale necessary to compete at the top end of the global energy shipping business,” said Craig H. Stevenson, Jr., CEO of Diamond S. “In addition, we are listing in the public market at what we see as a cyclically opportune time that makes us well-positioned for future industry consolidation, with one of the world’s largest tanker fleets, a cost-efficient management platform and a sound balance sheet,” Stevenson added.

Jerry Kalogiratos, Director and Chief Executive Officer of Capital GP LLC, commented: “We are pleased to see this strategic transaction completed and wish Diamond S best of luck as a listed entity. This transaction allows CPLP to reshape its business with a modern fleet with remaining charter duration of more than five years, providing CPLP unit holders with increased stability and cash flow visibility. Importantly, with this transaction completed, we are looking forward to expanding our asset base again with modern vessels employed under medium- to long-term charters with a view to growing our long-term distributable cash flow.”

Diamond S is now one of the largest publicly listed owners and operators of crude and product tankers in the world. It provides seaborne transportation of crude oil, refined petroleum and other products in the international shipping markets, operating a fleet of 68 vessels with an aggregate of approximately five million deadweight tons (“dwt”) in carry capacity. Its vessel operations are composed of two segments: Crude Tankers, which includes 15 Suezmax vessels and one Aframax vessel, and Product Tankers, which includes 52 medium range (“MR”) vessels.

DSSI is the product of the combination of DSS Holdings L.P.’s 43 vessels and the 25 vessels contributed by Capital Product Partners L.P. (CPLP). CPLP’s manager, Capital Ship Management (CSM), will continue to be the manager of the 25 vessels contributed to DSSI by CPLP and has a deep-seated history in shipping.

The Board of Diamond S. Shipping is comprised of Alexandra Kate Blankenship (Director), Gerasimos (Jerry) Kalogiratos (Director), Harold (Hal) L. Malone III (Director), Nadim Z. Qureshi (Director), Craig H. Stephenson Jr. (Chief Executive Officer, President and Director), Bart H. Veldhuizen (Director) and Gerasimos (Gerry) Venturis (Director).