A long-term investor in New York-listed Pangaea Logistics Solutions has begun to sell down its stake in the bulker owner just days after two of its executives resigned from the company board.
New York-based Cartesian Capital Group and principal Peter Yu sold nearly 439,000 shares between 18 March and 22 March for a payout of nearly $1.5m.
Cartesian will look to continue to sell a portion of its holdings in private transactions, the financial firm said in a filing to US securities regulators.
The Rhode Island-based owner announced at its last quarterly earnings that Paul Hong and Nam Trinh — Cartesian’s two representatives on Pangaea’s board of directors — have tendered their resignations, effective from 10 March.
“I think they gradually will reduce their stake on an opportunistic basis,” Pangaea chief executive Ed Coll said in a message this week.
“They have been in the company for 12 years, which is a couple of lifetimes in that world.”
Cartesian is the latest private equity firm to begin selling down a major stake in a US-listed bulker owner.
As TradeWinds has reported, the top three holders in New York’s Genco Shipping & Trading have sold large portions of their holdings, while Connecticut-based Eagle Bulk Shipping's top shareholder — Oaktree Capital Management — has been selling in the past week.
The sales have been fuelled in part by rising share prices for publicly listed bulker owners at the start of 2021.
Cartesian has some way to go with its Pangaea holding. The firm held 13.95m shares, or 30.6%, at the end of 2020, making it Pangaea’s largest individual holder.
After the recent sales, Cartesian continues to hold more than 13.5m units, or 29.6%.
At a recent share price of $3.15, the holding is worth about $43m.
Cartesian’s eventual withdrawal appears to be entirely amicable, with the investor and company paying compliments to each other in Pangaea’s quarterly earnings report.
"Cartesian committed time, ideas and capital to make Pangaea a leader in our industry and a consistently profitable enterprise," Coll said. "We will miss their energy in leading us forward, their curiosity in constructively interrogating our plans and their ideals, which we will try to emulate."
Cartesian founder Yu expressed a positive view of Pangaea's management.
"Under Ed's leadership, the company not only weathered but thrived during 2020, maintaining profitability despite a global pandemic, expanding its distinctive ice business, and delivering for its clients around the world,” Yu said in a statement. "Pangaea starts 2021 well positioned and poised for growth thanks to the tireless efforts of Ed and his entire team."
Pangaea reported its sixth consecutive profitable year in 2020, despite the fallout from Covid-19.
Pangaea disclosed an adjusted net profit of $14m, or $0.26 per share, for all of 2020, slightly down on the $18.2m, or $0.27 per share, recorded in 2019.
The owner pursues niche markets such as the Arctic ice trade with contract business that affords it a premium to dry bulk rate indices.
Cartesian is a global private equity firm with a focus on growing organisations internationally. It claims more than $3bn in capital commitments and has worked with 60 companies across 40 countries.(Copyright)
