International Seaways to Offer Baby Bonds

Tanker owner International Seaways (NYSE:INSW) has announced that they will be selling an offering of senior notes.

While details are sketchy the issue will mature in 2023–and we love short dated maturities (although not normally from shippers)

At this point in time we are not familiar with the company, but a glance at the company shows they are headquartered in New Your City and they operate a fleet of 49 tankers and through joint ventures they operate in the LNG field as well.

The preliminary prospectus for the new issue can be found here.

We will be doing a closer look at this one.

11 thoughts on “International Seaways to Offer Baby Bonds”

  1. Hi Tim,

    Shipping preferreds and notes comprise a good chunk of my retirement portfolio, so I’ll be interested to know what you come up with on International Seaways.

  2. Hi Tim, CFRA (S&P global) ratings: common is strong sell, overall risk is moderate, liquidity risk is high and financial leverage risk is moderate.

    1. Thanks MFZ–I glanced at the most recent earnings release and it wasn’t pretty–revenue fell hard.

  3. Tim,
    On an unrelated note, didn’t know if you saw this, related to OFS/OFSSL. Just some FYI.

    OFS Capital approves $10M stock repurchase program
    May 23, 2018 9:37 AM ET|About: OFS Capital (OFS)|By: Gaurav Batavia, SA News Editor
    OFS Capital (NASDAQ:OFS) approved a stock repurchase program to repurchase up to $10M of its outstanding common stock.

  4. Tim,

    Also, just saw this on another holding of ours, namely NSS.

    Just saw this on SA. They show the NSS ‘on the books’ out thru 2019, so do you think this means we are safe holding them and should worry less about a call coming?

    They talk about raising capital thru offerings but don’t talk about calling anything – at least not that I saw.

    Welcome any comments you have?

    Attention NSS holders:

    Just saw this on SA. They show the NSS ‘on the books’ out thru 2019, so do you think this means we are safe holding them and should worry less about a call coming?

    They talk about raising capital thru offerings but don’t talk about calling anything – at least not that I saw.

    Welcome any comments you have???

    https://seekingalpha.com/article/4176570-nustar-ns-presents-mlp-and-energy-infrastructure-conference-slideshow

    1. Thank Grant. I’ll look at it shortly. Right now it is trading perfectly–right at $25 plus accrued interest so we don’t have a ‘call risk’—we just have a replacement risk. I think that in the various financial presentations which show it out a year or two indicate they don’t presently plan to call–BUT I think if they could get out from under it they certainly would.

      1. I agree Tim…The mechanical terms of this issue is the best part of NSS. Currently under redemption plus next payment price, no real material chance of redemption, but market will still respect that possibility.
        Tim, I have continued playing with those Entergy Arkansas preferreds. Sold off 300 of them last week at almost $3 a share profit. And have bought back more the past week a buck or so under redemption. If they dont follow through with a redemption I will take a bare arse beating behind the woodshed. Im not worried as they have followed through the previous times…Which actually leads to another easy money trade with as they have followed a consistent pattern with their subsidiaries….But I dont have the nerve to get ahead of the curve as it may not happen or may be 2 years before they do it.

    2. Hi Grant, Slide 21 titled Debt Maturity Schedule talks about using the revolver to pay off the 7.65% senior notes and issuing new senior notes…and the fact they talk about it in past tense suggests it may happy fairly soon.

      1. That’s not what I read.

        They paid off the notes that matured in April. No more notes are maturing until 2020.

        They mention raising 1/2 billion of new $, but don’t mention it will be used for anything other than paying down the revolver (to get their credit metrics back in sync). Maybe they will use some new $ to redeem NSS and maybe not. Leads one to speculate, however, it also leads this one to think that they are in no big hurry to redeem anything this year so I think it’s safe to presume we’ll be able to get a few more payments out of this puppy.

        1. Hi guys–as long as it trades right at $25 plus accrued interest we will just collect as long as we can. It would be sad to lose another high payer after losing a massive Arbor Realty baby bond position last month.

      2. Citidel, NS had a 8.65% senior unsecured that matured in April. They used the revolver to redeem it…They will at some point issue a new bond to replenish the kitty fund of the revolver. I knew something happened as the bond just disappeared but no reissue occured despite the fact they said they would roll it over. The new issue just hasnt occured. NSS is totally unrelated to all of this. They will not move junior subordinated debt (NSS) into senior unsecured position. NS already has recieved the waiver to count NSS as a preferred and not as debt. NSS is going no where…Moodys a few months back stated that senior bond will need to be refinanced AND they will need additional capital raise as they will be cash flow negative this year. So another preferred may be in offing this year.

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