Wellard shares up 118 per cent

Wellard shares closed up 118 per cent on Monday to 3.7 cents, following news that it will sell its oldest livestock vessel, the M/V Ocean Ute, to Bassem Dabbah for $US12 million, or $18.1 million.

Fremantle-based Wellard, which told the market it was confident of returning most of the net sale proceeds to shareholders, said the sale to the Marshall Islands-registered company would likely be competed in September. This would be subject to both parties adhering to terms and conditions set in the Norwegian Shipbrokers’ Association’s Memorandum of Agreement for Sale and Purchase of Ships.

Wellard executive chair John Klepec told the market that the transaction came at the right time for the company.

“We are pleased to have achieved a sale price above the current net book value of the vessel,” Mr Klepec said.

“The M/V Ocean Ute has been a good vessel for Wellard and helped us meet a price point in the market.

“But it is about to reach a tipping point with respect to market value, maintenance costs, future cash generation and profitability, so the sale is a good outcome for Wellard and its shareholders.”