UPDATE: Morgan Stanley Reiterates on Knightsbridge Tankers Limited Following Capesize Acquisition
In a report published Tuesday, Morgan Stanley analyst Fotis Giannakoulis reiterated an Overweight rating on Knightsbridge Tankers Limited (NASDAQ: VLCCF), and raised the price target from $9.50 to $12.00.
In the report, Morgan Stanley noted, “VLCCF acquired 6 Capesize vessels from companies associated with John Fredriksen, 5 newbuild ships on order at a Chinese yard from FRO 2012 with scheduled for delivery by 3Q14 and one 2013-built from a private affiliate. VLCCF will pay $61m per newbuild and $55m for the delivered vessel, for a total of $360m. This will be funded with $186m of VLCCF shares issued at $10/sh, $24m from cash on hand, and VLCCF will assume $150m in remaining installments to the yard. VLCCF intends to finance each vessel with $30m in debt.”
Knightsbridge Tankers Limited closed on Monday at $11.23.
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