Diana Shipping has allowed its tender offer for Genco Shipping and Trading to expire, ending its acquisition attempt after deciding not to extend or reinstate the bid. The company said the offer expired on July 24 after Genco's management allegedly failed to engage in substantive discussions regarding the acquisition proposal first submitted on June 17.
Under the revised proposal, Genco shareholders were offered $27.34 per share, consisting of $24.80 in cash and $2.54 in Diana Shipping shares based on a 30-day volume-weighted average price.
Diana Shipping said that by the expiry of the offer, 11,778,419 shares, representing 31.6 per cent of Genco's outstanding shares not already owned by the company, had been tendered. However, it noted that a depositary agency system error required some shares to be withdrawn and re-tendered.
Genco disputed Diana Shipping's claim that it had not engaged with the proposal, stating that its board of directors continues to review the non-binding offer.
The company added that it will, "continue to engage in good faith discussions with Diana with the goal of determining whether a transaction that fully and fairly compensates Genco shareholders is achievable".
Genco also raised concerns about the proposed transaction, citing potential stock dilution, the terms of potential asset sales, and the limited voting rights attached to the Diana Shipping shares included in the offer. The company further noted that Diana Shipping's shares closed at $2.25 on July 24, below the $2.54 value assigned to the stock component of the offer.