Scorpio Bulkers to Sell Seven Newbuildings

File photo: Scorpio Bulkers
File photo: Scorpio Bulkers

Scorpio Bulkers Inc. (NYSE: SALT) has confirmed that it has entered into agreements to sell a total of seven newbuildings as the severely deteriorated dry bulk shipping market continues to bite.

Scorpio said it is selling three Capesize vessels, one Kamsarmax vessel and three LR1 product tankers for approximately $290 million in aggregate.

The Capesize vessels are currently being constructed in Romania, and have expected delivery dates between the fourth quarter of 2015 and the second quarter of 2016. The Kamsarmax vessel is currently being constructed in China and has an expected delivery date in the first quarter of 2016, while the LR1 product tankers are currently being constructed in South Korea, two of which are scheduled for delivery during the second quarter of 2017 and one during the third quarter of 2017.

After the sale of the newbuilds, Scorpio has contracted for 59 dry bulk vessels consisting of 25 Ultramax, 19 Kamsarmax (including one vessel held for sale), and 15 Capesize vessels, from shipyards in Japan, South Korea, and China. The Company has also contracted for six LR2 product tankers that are currently classified as held for sale, from shipyards in South Korea and Romania.

The sell off comes amid the worst dry bulk market in decades that earlier this year saw freight rates reaching 30-year lows. On Wednesday, the Baltic Dry Index fell one point to 600 points – up from its all-time low of 509 points on February 18th but well below its 52-week high of 1484 points on November 4, 2014.