Diana responds after Genco takeover bid is turned down

Diana Shipping is promoting the change of the members of the Genco board of directors. After the rejection, without dialogue, of the Genco takeover proposal, Diana as the largest shareholder of the US company with 14.6% of the shares, considers that a substantial change is required for the board of directors to seriously evaluate its offer and the opportunities to maximize value for shareholders.

According to Diana, Genco’s current board of directors failed to engage constructively with Diana – its largest shareholder – and to meaningfully evaluate the attractive takeover proposal with a significant premium.

“Diana’s highly qualified independent candidates (ed. six candidates) for the Board of Directors have extensive experience in dry bulk shipping, financial management, mergers and acquisitions and corporate governance,” the company noted.

Diana’s CEO, Semiramis Paliou, said: “Diana strongly believes in the benefits of consolidation in the dry bulk shipping industry. Our all-cash proposal would leverage the advantages of combining our platforms and provide Genco shareholders with immediate and certain value at a substantial premium to historical trading levels. Despite our stated readiness to engage constructively with Genco’s board and advisors, we are deeply disappointed that they have completely refused to engage with us.

As Genco’s largest shareholder, we believe we have a duty to act in response to the board’s failure to properly consider our offer. Our decision to nominate highly qualified, independent candidates to replace the current members reflects our belief that Genco shareholders deserve a renewed board, open to exploring strategic alternatives to maximize shareholder value, including a good faith discussion regarding our highly attractive value creation opportunity.”

Diana’s offer to acquire all of Genco’s issued and outstanding common shares is for a consideration of 20.60 dollars per share in cash. Diana’s offer provides all Genco shareholders with the opportunity to earn a significant premium and is supported by a highly confident letter from two leading shipping banks, Diana said in a statement.

The existing Genco Board of Directors, however, took more than six weeks to respond to the proposal, during which time it did not engage with Diana at all regarding the financial or structural elements of the proposal.

In light of the current board’s refusal, Diana believes that Genco shareholders would benefit from the ability to elect directors who are open to exploring strategic alternatives to maximize shareholder value, including an objective, independent and good faith review of Diana’s proposal.