DryShips Inc. (NASDAQ:DRYS), better known for owning offshore support vessels and drybulk carriers, announced that it would exercise the preferred stock right. As per the reports, the board of directors gave approval for exercising this right under Revolving Facility Agreement with Mr. George Economou owned Sifnos Shareholders Inc.
Insights of The Matter
As part of this exercise, DryShips has decided to convert the outstanding loan amount of $10,000,000 into 100 million preferred shares. Post the issuance, each of these preferred shares will be converted into common shares on a one to one basis. Reports claim that this entire procedure is to be finished within three months of the issuance date, which is decided by the company.
The senior management team of the company is delighted to announce this update and hopes that it will give the right balance to its share capital in the future. According to Ziad Nakhleh, CFO, DryShips, the present business environment isn’t favorable to drybulk companies, yet DryShips managed to add another $10 million to its balance sheet without any hassle.
In his opinion, the danger of being de-listed from NASDAQ stock exchange in the first half of 2016 is haunting the company at this moment. To avoid this event, there’s a need for reverse stock split of company’s common shares. DryShips requires shareholders approval to execute this reverse stock split, and Nakhleh believes that the support of Sifnos will help the company do it without any hassle.
Meanwhile, DryShips Inc. (NASDAQ:DRYS) announced that it will have a special meeting of shareholders at its headquarter located in Athens, Greece on February 19, 2016. Investors holding company’s shares by the end of January 8, 2016, are to be considered for the notice about this meeting. Eligible investors will receive notices on or before January 15, 2016.
Further information about the issues that are likely to be discussed during this meeting will be announced at a later date.
