Genco Shipping & Trading rejects Diana takeover bid, saying the $23.50-per-share offer undervalues the company and carries significant execution risks. US-listed dry bulk owner has turned down a revised all-cash acquisition proposal from Greece’s Diana Shipping, stating that the bid fails to reflect the company’s true value.
The decision followed a review by a special committee of independent directors, which concluded that the offer does not provide an adequate premium for shareholders.
The rejection comes shortly after Diana increased its offer from $20.60 to $23.50 per share and secured financing support, including a partnership with Star Bulk Carriers. Diana, which already owns approximately 14.8% of Genco, positioned the revised proposal as a 31% premium to the undisturbed share price.
However, Genco argued that the benchmark used is outdated and does not account for improvements in its earnings and asset values. The board also criticized the valuation methodology, noting that Diana relied on the lowest analyst net asset value (NAV) estimate rather than broader averages, which exceed the offer level.
A major sticking point is the proposed structure of the deal, particularly the planned sale of 16 vessels to Star Bulk Carriers for about $470.5m. Genco said the agreed prices imply a “fire sale,” with some ships valued well below broker estimates, including newer and larger units.
The company also raised concerns over financing. While Diana said it had secured $1.433bn in committed funding, Genco noted that publicly disclosed commitments appear closer to $1.1bn, highlighting execution risks.
Despite rejecting the offer, Genco said it remains open to discussions on a proposal that properly reflects its asset base, earnings profile, and exposure to a strengthening dry bulk market
