BOXSHIP owner Euroseas has announced plans to spin-off three of its older vessels into a new company, Euroholdings Ltd, and list it on the Nasdaq.

The Athens-based company, which also trades on the Nasdaq, announced the move on Friday morning, adding that Euroholdings has already applied for the listing.

Euroseas plans to contribute the 1999-built, 1,730 teu  Joanna (IMO: 9204477), the 1997-built, 1,295 teu Aegean Express (IMO: 9138161), and the 1998-built, 2,008 teu Diamantis P. (IMO: 9146314), to Euroholdings in return for 100% of its shares, which it will then distribute to its shareholders.

Euroseas chairman and chief executive Aristides Pittas said the move will allow the company to “maximise” on the older vessels’ value and expects the separate entities will achieve better valuations separately than combined.

“The spin-off of our three older vessels into a separate entity and the distribution of all shares to our common shareholders, the only shareholder class in our capital structure, enables us to maximise the value of the older vessels in our fleet and shareholder returns by creating a new platform to capture new opportunities following a different strategy from Euroseas,” he said in the announcement.

“Euroholdings shares represent only about 5% of our Euroseas’ NAV estimate, so the spin-off is not expected to have any material impact on Euroseas and its overall strategy.”

The three vessels are unlevered and two of them are under time charters, “providing medium term visibility of earnings”, said Pittas. The boxship trio will continue to be managed by Euroseas affiliate Eurobulk.

“Given the company’s fleet profile and capital structure, shorter remaining economic life and higher intended dividend distribution policy, we believe that Euroholdings shares should trade at better valuation levels and smaller or no discount to net asset value compared to its sector peers,” Pittas said.

“We anticipate that both Euroseas and Euroholdings will be valued better separately as they offer more and different options to investors. Furthermore, Euroholdings with its clean balance sheet and relatively liquid platform can be used as a consolidating vehicle in the shipping sector, especially for vintage vessels, creating additional value to shareholders over the longer term.”

Euroseas will hold a conference call to discuss the spinoff on Tuesday.

The company cautioned that “there can be no assurance that the spin-off transaction will ultimately occur or, if it does occur, what its structure, terms or timing will be”.