Diana Shipping's $24.80 Cash Offer for Genco Rejected

Diana Shipping (DSX) commented on the Genco (GNK) Board of Directors' rejection of Diana's $24.80 per share all-cash tender offer. This is the third time the Genco Board has rejected Diana's offers to acquire Genco without any engagement whatsoever. Semiramis Paliou, Diana's CEO, commented: "Genco's news release today makes clear - more than ever - that the Genco Board is not going to engage in a constructive dialogue regarding our proposal. Despite an empty statement that they are willing to engage, their conduct for more than six months demonstrates the exact opposite. The Genco Board has no intention whatsoever of participating in the type of dialogue that can result in an attractive transaction for their shareholders. This is how they have conducted themselves for more than six months - rejecting engagement while offering no counterproposal, refusing every conversation, and moving the goalposts on valuation by discarding the same broker values they published for five years the moment those values no longer served their purpose. It is now completely apparent this will not change, and the potential to realize shareholder value will remain at risk. Shareholders should ask themselves a simple question: why has Genco suddenly abandoned VesselsValue - the independent, widely-accepted broker valuation source it relied upon and published in its own investor presentations for more than five years - and replaced it with sell-side analyst estimates it has never before utilized with shareholders? Diana's two most recent offers reflected nearly 100% of Genco's net asset value as reflected in VesselsValue broker valuations, consistent with Genco's own historical practice. Only in Genco's most recent presentations did this approach change - and conveniently, the NAV figures increased as a result. This is particularly striking given that Genco's shares have traded at an average 30% discount to NAV over the past five years. Diana has made two offers using the broker values Genco itself published for years. Now Genco has changed its own source and is using the new, higher numbers to justify its rejection. Shareholders should draw their own conclusions about why. Beyond the question of which valuation source is most appropriate, Genco is demanding a premium on top of those inflated estimates when shares of drybulk companies, including Genco itself, have consistently traded at a meaningful discount to NAV. Shipping take-private transactions have on average been concluded at a 20% discount to NAV - not at a premium. Applying a control premium on top of an already inflated NAV estimate is a framework designed to make any offer appear inadequate, not to achieve a fair result for shareholders. And absent a transaction, Genco shares will likely return to those discounted trading levels. Diana has repeatedly explained this. Genco continues to disregard it. Diana has consistently demonstrated its willingness to engage constructively and remains prepared to discuss a transaction at any time, without preconditions. We have made three all-cash offers, delivered a merger agreement that can be signed in a short period of time, and launched a fully financed tender offer directly to shareholders. Genco has only rejected engagement and left shareholders with a clear choice in connection with the June 18 Annual Meeting: it is time to elect six independent directors who will ensure their board finally engages in the type of good faith process that shareholders deserve. We urge all shareholders to act now."