DryShips Inc (NASDAQ: DRYS) is having a relatively strong start to the trading session, following up on the gains that we saw on the stock yesterday. However, today’s gains are for an entirely different reason. In a press release issued early this morning, the company announced a spin-off that’s leading to excitement among investors. Today, we’ll talk about the spin-off, what we’re seeing from the stock as a result, and what we’ll be watching for with regard to DRYS ahead.
DRYS Gains On Spin-off News
As mentioned above, DryShips is having an overwhelmingly strong start to the trading session this morning after announcing a spin-off. The announcement comes after the company announced a dividend and share repurchase program, aligning with investor interest. However, today’s news surrounds the spin-off of Gas Ships Limited Inc.
Gas Ships Limited Inc. is a wholly owned subsidiary of DRYS. In a press release issued this morning, the company announced that it has filed a registration statement on Form F-1 with the US SEC to move forward with the spin-off. Through the spin-off, investors in DRYS will receive 49% of Gas Ship Limited’s common stock. From there, Gas Ships Limited will become a publicly traded company of which DRYS will retain 51% ownership. In a statement, George Economou, Chairman and CEO at DryShps, had the following to offer:
The filing of the Form F-1 Registration Statement is an important step in the process of establishing Gas Ships Limited as a new, stand-alone company with its own strategic focus, independence and priorities. We believe that this business is well-positioned for success as a separate company.
What We’re Seeing From The Stock
One of the first lessons we learn when we start to dabble in the market is that the news causes movement. In this particular case, the news proved to be overwhelmingly positive as the DryShips spin-off will likely be beneficial to the company and its investors. So, it’s no surprise to be seeing strong gains in the value of the stock today. Currently (10:25), DRYS is trading at $3.74 per share after a gain of $0.15 per share or 4.18% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on DRYS. In particular, we’re interested in following the story surrounding the spin-off, the dividend payment, and the share repurchase program. As the year 2018 continues, management at Dryships seems to be making the right moves. Let’s hope they keep it up!
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