(By Balaseshan) Box Ships Inc. (NYSE:TEU), an international shipping company, said it has priced a public offering of $30 million of common shares at $7.00 apiece, a 13.7% discount to previous closing price.
The company has granted the underwriters a 30-day option to purchase an additional $4.5 million of its common shares to cover over-allotments, if any. The offering is expected to close on or about July 18, 2012.
Neige International Inc., a company controlled by Chairman, President and Chief Executive Officer Michael Bodouroglou, has agreed to purchase 2.6% of the common shares sold in the offering at the public offering price.
Box Ships plans to use a portion of the net proceeds of the offering to redeem 692,641 of the 1.33 million 9.75% Series B Cumulative Redeemable Perpetual Preferred Shares issued to Neige International Inc. in a previously announced private transaction at a price equal to the liquidation preference of $30.00 per share, plus accrued and unpaid dividends.
The company used to proceeds of the private transaction to partially finance the acquisition price of the vessels OOCL Hong Kong and OOCL China delivered to Box Ships on June 25, 2012 and July 5, 2012, respectively.
Box Ships intends to use the balance proceeds of the offering for general corporate purposes, which may include the repayment of debt.
Barclays, Credit Suisse and Deutsche Bank Securities are acting as joint book runners of the offering. Dahlman Rose & Company is acting as co-manager for the offering.
TEU is trading 18% lower at $6.65 on Friday. The stock has been trading between $6.44 and $11.39 for the past 52 weeks.