Scorpio Bulkers has had a change of heart on its latest equity issue. New York-listed Scorpio announced plans to print 10 million new shares yesterday. In a statement on Wednesday the shipowner said it would not proceed with the move due to the “unsatisfactory price” offered to the company.

Emanuele Lauro, chief executive of Scorpio Bulkers, told TradeWinds: “We would have been happy to raise equity opportunistically to pursue ship acquisitions. However, this had to come at the right price. We are guardians of shareholder value for the long term.”

Financial market sources say that there was no shortage of investor demand for the paper and Scorpio Bulkers had its book covered.

Unappealing discount
Scorpio faced a 6.5% pricing discount to the previous closing price of $8.35 per share, meaning it had a book at about $7.80 per share, according to sources familiar with the effort.

While the discount is smaller than what many companies have paid in follow-on issues in recent months, it was viewed by Scorpio management as too steep for an owner that is not desperate for capital and looking to move opportunistically on assets.

A pricing of $7.80 would have been toward the low end of recent NAV estimates from analysts, which have ranged from $7.50 to $9.90. Executives have plenty of skin in the game with Scorpio Services Holding the largest shareholder in the company.

GRM Investments is the leading outside stakeholder, with Evermore Global, Raging Capital. Blackrock and Anchorage Capital among the leading institutional investors.

Confident in recovery
Scorpio Bulkers has enjoyed an active few weeks, having followed up a six-ship fleet deal with John Fredriksen’s Golden Ocean with the introduction of a dividend. Further cash has been expected to drive additional growth at the 52-ship company.

Scorpio executives had this week voiced their confidence in the dry cargo market recovery and expressed an interest in further acquisitions. “In general, we remain optimistic for the dry cargo market recovery and look forward to further strengthening our position in the market in what is an improving rate environment,” Lauro said on the company’s quarterly conference call.