DryShips Inc. (DRYS), the New York-listed operator of commodity carriers and drilling rigs, said it’s in arbitration with China Cosco Holdings Co. over payments for ships chartered out to the Chinese company.

The dispute covers three vessels and the process is taking place in London, DryShips Chief Financial Officer Ziad Nakhleh said today by phone.

“We are in arbitration and when the arbitration award comes out we’ll be able to get the money back,” Nakhleh said.
The Baltic Exchange, the world’s biggest shipping bourse, said yesterday some members “raised concerns” over the alleged failure to make charter payments. Cosco, the world’s third- biggest owner of dry bulk commodities vessels, has had three ships seized in the U.S. and Singapore in the past two months, legal filings show.

Cosco, based in Tianjin, China, was locked into long-term contracts at rates higher than market prices, according to the legal filings made for the ship seizures.

The Financial Times earlier reported DryShips Chief Executive Officer George Economou as saying that he may consider seeking more ship seizures. Nakhleh declined to comment.

Calls to Cosco’s media-relations and investor-relations offices earlier today went unanswered. A later call to its offices in the U.K. also wasn’t answered and a message left with the media relations department in the U.S. wasn’t immediately returned. Cosco in an Aug. 16 statement said involving the media “may potentially further complicate the existing situations.”
Cosco owned 24.8 million deadweight tons of dry bulk ships in April, ranking it third globally behind Nippon Yusen K.K. and Mitsui O.S.K. Lines, according to data on the website of Mitsui. Cosco also had an additional 222 ships on charter as of Dec. 31, according to its annual report.