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Certainly very good pieces of news for existing unit-holders. I find it almost impossible to believe that the Trust managed to secure loans at 88% gearing from local banks to fund its latest acquisition ! PST has mentioned that it will not be raising new equity in the near term so DPU should steadily spike up when the first vessel is delivered in Sept this year.
Lets examine how much equity PST needs to inject into the acquisition of 9 vessels made in 2010 in light of the recent financing efforts -
Acquisitions:
2 X 180,000 DWT Capesize vessels leased to Shagang for US$123.2 million
2 X MPP vessels leased to Cosco for US$60.0 million
5 X 57,000 DWT Supramax vessels leased to Glovis for US$150 million.
1) Shagang & Cosco vessels
Acquisition: US$183.2 million
Financing: US$150 million
Equity Required: US$38.2 million
2) Glovis Vessels
Acquisition: US$150 million
Financing: US$132 million
Equity Required: US$18 million
Equity Calculations:
Total Equity Required: US$56.2 million (PIL has loaned PST US$54 million to settle pre-delivery financing)
Deposit Paid in 3Q 2010: US$14 million
Potential Cash Retained for FY 2011/12: US$15 million (PST retains US$1.8 million quarterly)
Net Equity Required: US$56.2 mil - US$14 mil - US$15 mil = US$27.2 million
I would hence expect PST to raise new equity of at least 20-30% of its current market capitalization to finance the equity portion in late 2012. Judging by the relatively high revenue to asset yield, the acquisitions should be yield accretive after equity financing is completed. However, its gearing will take some time to drop since it amortizes its loans steadily.
PST closed at US$0.345 today. Its market capitalization stands at US$203.4 million.
Please correct me if any of my figures/assumptions/date is incorrect.
(Not Vested)
Lets examine how much equity PST needs to inject into the acquisition of 9 vessels made in 2010 in light of the recent financing efforts -
Acquisitions:
2 X 180,000 DWT Capesize vessels leased to Shagang for US$123.2 million
2 X MPP vessels leased to Cosco for US$60.0 million
5 X 57,000 DWT Supramax vessels leased to Glovis for US$150 million.
1) Shagang & Cosco vessels
Acquisition: US$183.2 million
Financing: US$150 million
Equity Required: US$38.2 million
2) Glovis Vessels
Acquisition: US$150 million
Financing: US$132 million
Equity Required: US$18 million
Equity Calculations:
Total Equity Required: US$56.2 million (PIL has loaned PST US$54 million to settle pre-delivery financing)
Deposit Paid in 3Q 2010: US$14 million
Potential Cash Retained for FY 2011/12: US$15 million (PST retains US$1.8 million quarterly)
Net Equity Required: US$56.2 mil - US$14 mil - US$15 mil = US$27.2 million
I would hence expect PST to raise new equity of at least 20-30% of its current market capitalization to finance the equity portion in late 2012. Judging by the relatively high revenue to asset yield, the acquisitions should be yield accretive after equity financing is completed. However, its gearing will take some time to drop since it amortizes its loans steadily.
PST closed at US$0.345 today. Its market capitalization stands at US$203.4 million.
Please correct me if any of my figures/assumptions/date is incorrect.
(Not Vested)
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.