Aug. 19 (Bloomberg) -- Star Bulk Carriers Corp. climbed to the highest in almost two months after the commodity-shipping company bought 34 vessels from Excel Maritime Carriers Ltd.
The acquisition positions the company to take advantage of improving rental rates for bulk carriers, Petros Pappas, Star Bulk’s chief executive officer, said in a statement. It boosts the company’s fleet by almost 50 percent to 103 ships, with cargo-carrying capacity of 11.85 million metric tons of commodities including coal and iron ore, according to the statement. Shares advanced in New York by as much as 88 cents, or 6.7 percent, to $14, the highest since June 23.
“This is, if anything, positive for valuation because they’re getting more exposure in a market that we think is improving,” said Eirik Haavaldsen, an analyst at Pareto Securities AS in Oslo, who recommends buying the stock. “They’re becoming more and more the No. 1 dry bulk player, with very broad exposure, a very diversified fleet.”
Shipping rates are poised to rally in the second half of the year as Vale SA, the world’s largest iron-ore producer, drives up exports of the raw material, according to Commodore Research & Consultancy. The Baltic Dry Index, a gauge of rental rates for four sizes of bulk carrier, climbed to a four-month high of 1,042 points yesterday.
Star Bulk paid a combined $288.4 million in cash and 29.917 million shares for the ships, which include six Capesize carriers, 14 Kamsarmax vessels, 12 Panamax ships and two Handymaxes, the Maroussi, Greece-based company said in a statement.