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Navios Maritime Acquisition Corporation Message Board

  • foo_star foo_star Oct 22, 2012 8:05 PM Flag

    OSG troubles, NNA opportunity??

    OSG owns/operates over 100 tankers. Looks like they're at a very real risk of going under. Went from 7.00 to 1.25 in a couple of weeks - dropping like a stone today from 3.15 to 1.23. You read that right. They filed an 8K today and were downgraded...

    "The downgrade reflects our belief that OSG is facing a high probability of very near-term default, following the company's announcement today that it is
    evaluating strategic options including potentially filing Chapter 11. OSG also
    stated that its previously issued financial statements for the past three
    years ended Dec. 31, 2011, and associated interim periods for the quarters
    ended March 31 and June 30, 2012, should no longer be relied upon."

    So, time for AF to make a bold move at the right price?? If Cash is King AF is the king's puppeteer.

    Sentiment: Buy

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    • Doubt it. If anything the trouble at Torm would have been more up NNA's alley, but these big companies won't be broken up, they'll just change ownership in the reorg. What the shipping banks want to do when they are faced with dead loans is to convert the loans to performing loans rather than sell off the assets. They way to that with a monster like OSG is to wipe out the sub debt holders, take equity, and align bank debt burden with ops. If it was Joe Blow Shipping (or Ioannis Blowopoulos Shipping in this case) that's when the banks might approach NNA with a deal.

    • foo I am sorry but I don't see the opportunity. NNA has no cash, their cost of capital is high (look at interest rate on debt) and they have no stock currency. I see more opportunity for Wilbur than Angeliki. While they both share good looks he has more cash. OSG is just another casualty of the worldwide recession and the shipping depression.

      • 2 Replies to el1genio
      • Some Thoughts On A Fleet Acquisition:..................................................................................
        1) The first question one should ask is where will most of the benefit accrue in an AF acquisition. Logically, AF might want to see the new ships and their benefits accrue to NM where she has the largest ownership percentage............................................................................................................................
        2) Perhaps a more compelling option would be an arrangement where a new subsidiary would be created and one or more re-possessing banks would retain an ownership interest. No drop-downs would be allowed without bank agreement because the banks interest could be compromised that way. No unapproved sales would be allowed until the banks interests were dissolved. So, when the stock reached some price level, a secondary offering would be done to buy out the banks interest. The banks would walk away having recovered much more than they could have achieved by simply selling off the ships. The banks would have also gained AF's management assistance as the banks worked their way out of this trouble. AF would gain a fleet for which she had put up not a dime. This gain would be shared with not a single current shareholder of any Navios company. Were I Miss AF, this is the way I would want to frame the deal so as to have maximum benefits for herself and the banks. The banks are going to need some inducement to go with AF's proposal. There is no inducement like being able to recover past losses.

      • NM has cash, maybe AF can figure something out.
        And last time banks made agreement on ship purch for NNA they agreed to no NNA equity pays till delivery. AFs 'currency' is so well respected I cant help but think they'll be thinking of her if there is a fleet or set of ships that need a new owner fast.

        Sentiment: Buy

 
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