Genco Shipping & Trading Limited has firmly pushed back on takeover interest from Diana Shipping Inc., with its board unanimously rejecting a non-binding $20.60-per-share cash proposal that it says "significantly undervalues" the company and carries unacceptable execution risk.
In a statement released January 13, Genco Shipping & Trading Limited said its board, acting on the recommendation of an independent committee and advised by external financial and legal counsel, concluded that Diana’s approach was “not in the best interest of shareholders.” The board cited both valuation and structural concerns, including the lack of committed financing and Diana’s higher leverage profile.
The proposal came from Diana Shipping Inc., which already holds a stake in Genco and sought to acquire the remaining shares it does not own. Genco said the indicative offer failed to reflect the intrinsic value of its business, fleet and balance sheet, and did not include an appropriate premium for control.
According to Genco, the offer price sits below the company’s net asset value at a time when drybulk asset prices are rising, and well below its 10-year high share price of $26.93. The board also emphasized Genco’s track record of durable cash flow generation and capital returns, noting that it has paid $7.065 per share in dividends over the past six years, representing nearly 40% of its current share price.
Beyond valuation, Genco highlighted what it sees as material execution risk. The company pointed to Diana’s higher leverage and the substantial borrowing required to complete the transaction, saying Diana’s “highly confident” assertions fell short of committed financing.
While rejecting the offer, Genco made clear it is not opposed to consolidation in principle — just on its own terms. In a January 8 letter to Diana leadership, including CEO Semiramis Paliou, Genco proposed an alternative structure in which Genco would act as the acquirer, using a mix of cash and its own equity.
Under that scenario, Genco argues Diana shareholders would benefit from immediate cash value and exposure to a larger, more liquid company with lower leverage, stronger governance and a lower cash-flow breakeven. Genco estimates a combined fleet would total 83 vessels, placing the company among the top 15 drybulk owners globally.
“Our Board remains confident in the continued execution of our proven strategy,” said Genco Chairman and CEO John C. Wobensmith, emphasizing a focus on low leverage, sizeable quarterly dividends and opportunistic fleet renewal in what the company describes as a strengthening drybulk market.
Diana, Genco said, declined to engage on the alternative structure and reiterated its original offer, bringing discussions, at least for now, to a halt.
