Greek Shipping News Cuts
Week 18 - 2005


Greeks dominate international ship sale and purchase market

---Greek shipowners kept a brisk pace in buying and selling used vessels in early 2005, according to shipbrokers George Moundreas & Co SA.
"Greeks have always had a very strong presence in the sale and purchase sector, having the judgment required to make their moves in the best period, that is when market prices are better," says the head of the company's finance department, George Gregoriadis. "This continues today, as from the start of the year their presence is very intense," he notes.
Many analysts believe that the deal of the year is already done as Ceres Hellenic of the Livanos family sold 16 Suezmax ships to Belgium's Euronav for $1.5 billion. Euronav also purchased four VLCCs (300,000 dwt) from Metrostar of Theodoros Angelopoulos, one of which was still being built. The price agreed was $477.5 million.
Metrostar received another $272.5 million from the sale of two more VLCCs to Gulf Management. In all, the company has cashed in $816.5 million from the beginning of the year, having also sold two tankers to Interorient.
Some of the most active companies are those listed on the New York Stock Exchange, especially Dryships of the Economou group, which was only listed in February. Since then it has invested almost $300 million for the purchase of five ships, without intending to stop, having committed itself to buying 15 vessels (beyond the 10 it already controls) in the next two years. Its most expensive purchase was the 2004-built Katerina V, a 171,000-dwt bulker from Greek company Golden Union of Veniamin and Gavriil for $85 million.
Similarly, Danaos Shipping of the Kousta family spent $124 million for the purchase of two containers of 3,711 TEU, which have already been time-chartered and will be delivered in 2007.
Top Tankers continues its investments in ships, buying three gas tankers of 46,000 dwt from the Latsis group and another product tanker from MMS, spending a total of $169 million.
Many further sales and purchases are also linked to Greek interests but not confirmed yet. It is certain, however, that the strategy of Greek companies, besides covering their needs, focuses on selling older ships and replacing them with new and bigger ones.
There also are profitable sales of vessels which are still in the shipyards; the foresight of several domestic firms to order ships two and three years ago is fetching them large profits before they even receive the newly built vessels, as prices have risen considerably since.
Greek shipowners' focus on buying and selling is also dictated by another factor: the difficulties of building new ships. The lack of building slots along with sky-high prices and the long completion periods have made newbuilding a particularly risky activity. As a result, new orders by Greek interests so far this year have been strictly limited. This had actually been the trend from the second half of 2004.
Data by the London Committee of Maritime Cooperation, representing Greek shipowners based in the UK, showed outstanding ship orders at 338 in March, from 256 in March 2004.
Out of those 338 ships, the biggest category (104) is chemical cargo vessels, followed by dry bulkers (86), containers (24) and liquefied natural gas carriers or LNGs (12). Note that when it comes to tankers, shipowners place more emphasis on size than on number.
New orders
Within this year Arcadia, of Constantinos Angelopoulos, has used its option and agreed with Samsung for the delivery of one more Aframax tanker (115,000 dwt) in 2008 for $66.5 million.
An impressive move was the deal by A.M. Nomikos for the building of two Handymax bulkers in a particularly short period, to be delivered within 2006. A George Moundreas & Co report suggests that this deal with Japanese shipyard IHI is a special case, since such delivery times are unprecedented.
In the liquefied petroleum gas (LPG) vessels sector, the orders for two ships of 82,000 cubic meters by Dorian Hellas, of the Hatzipateras family, stand out. The ships are priced at $85 million each, ordered at the Hyundai shipyard. A similar 84,000-cubic-meter ship is reportedly ordered by Kirsten, of the Angelikousis group, to be delivered within 2008, just like Dorian's ships.
Source:, 5 May 2005, NIKOS ROUSSANOGLOU

Owners express reservations about plan for a doctor on board
---Ship operators have expressed grave reservations about a government plan to put a doctor onboard all Greek-flag passenger ships. The operators say the plan, put forward by the ministers of Marine and Health and Social Solidarity, Manolis Kefaloyiannis and Nikitas Kaklamanis, raises serious legal and practical issues.
The shipowners content that had they been consulted prior to the announcement of the plan, they would have been able to point out the problems associated with it. They said such a plan must have the support of the European Union as it probably comes under EU competition rules.Owners also say the doctors must be seafarers as they are part of the ship's crew and are under the command of the ship's captain. In the shipping industry the legal responsibility of what happens on board falls on the captain and his employers, and owners and the ship's insurers are concerned they can be held responsible for the consequences of the medical decisions taken by the doctor on board and the medical advice or service that may be administered.
Owners also wonder who is going to shoulder the financial burden incurred by items like salaries, accommodation, food and the loss of income because cabin space will have to be given over as medical facilities. Further, they question the wisdom of having a doctor on board for trips which today take an average four to five hours, much less time than previously. They also note that today's highspeed ships are anyway being used more frequently to provide an ambulance service around the Greek archipelago.
Source:, 6 May 05

Greeks need to get on with their job
---The Greek government is making feverish attempts to drum up more domestic investment and the $17bn earned by the country's shipping industry in 2004 seems to be acting as a magnet.
The prime minister talked individually with entrepreneurs, including shipowners and the president of their union.
Then came an announcement that regulations governing the listing of ocean-going shipping companies on the Athens Stock Exchange (ASE) were being relaxed in an effort to generate interest in domestic flotations.
Shipping minister Manolis Kefaloyannis proudly announced the impending changes but the ASE says it decides what is altered and nothing is final yet. It seems the requirement for a special type of shipping-investment vehicle will be dropped along with flag restrictions. A minimum capital requirement for companies of EUR 29.35m ($38.39m) in the year of listing remains, while the company must control at least 3,000 gt
Kefaloyannis says the aim was to attract attention to Athens and away from exchanges in New York, to which Greek companies have been flocking.
What does not seem to have received major consideration on the part of the bourse and its planners is that the regulations had already been tinkered with twice since first being legislated in 2000 - and there is still not a single listed ocean-going shipping company on the ASE.
Observers also feel that owners, if asked, may well point out that what the exchange can offer them would do little to compensate for possible exposure to the political pressure that a listing could generate.
Shipping issues on the US markets tend to approach $200m but Athens has hardly the volume to accommodate one listing of that size, let alone several.
Smaller players, like Mediterranean cargoship operators, might find a suitable arena - but smaller players mean a bigger risk for investors, observers say.
Regarding land-based investments, an executive of a leading Greek shipping company queried: "Why go to the rich?" Investor equity is just a small percentage of the total, he says. The remainder comes from financing - and banks would only be wooed by attractive feasibility studies. Shipping, just as it is, creates jobs and wealth at no cost to the government, he comments.
So what can the government do to cash in on the unprecedented amount of cash jingling around in shipowners' pockets? Probably what the shipowners have been advocating for the past several decades: Let them get on with their job.
But it is also important to listen to reasonable requests for measures that will make Greek shipping even more competitive than it is today in the world arena.
Source:, published: 06 May 2005

S.Korean trade financing bank offers us$135 mln to Greek ship co
---SEOUL - The Export-Import Bank of Korea will offer US$135 million in loan to Danaos Holding Ltd, Greece's largest container shipping company, to help its purchases of two container ships from Samsung Heavy Industries Co. (KSE:10140). Samsung, the world's third-largest shipbuilder, has won an order to build two container ships with 9,600 TEU each for the Greek firm (TEU stands for 20-foot equivalent unit). The South Korean trade financing bank specializes in extending long-term loans to local exporters and foreign institutions to support exports.
Source:, Friday May 6, 6:42 am ET

Quintana - Wall Street Mining Wall Street
---This week, we saw the filing of an IPO called Quintana Maritime, which is backed by Corby Robertson, whose family sold the Quintana oil field in Texas to Exxon many years ago, and who has since made investments in commodities such as coal mining. Robertson has teamed up with First Reserve of Greenwich (who have been plotting an entry into shipping ever since their agreement to purchase OMI shares at about $1.50 each a few years ago failed amidst bad feelings) and American Metals & Coal International, also of Greenwich. Stamatis Molaris, former CFO of Stelmar, is serving as CEO and President of Quintana. Citigroup and Morgan Stanley, who lent the company the money it needed to acquire its fleet, are acting as joint bookrunning managers.
A Short History
Quintana does not have the storied history that many recent and future issuers have. They cannot point to hundreds of years of experience or their origins from an island - except perhaps Long Island.
In fact, they were formed on January 13th, 2005, and began operations in the following April, in other words last month. As of March 31, 2005, Quintana had not taken delivery of any of the identified panamax vessels, though the company did take delivery of three such vessels in April, and expects to take two more in May and the remaining three in July, August and September.
Distinguishing Deals
One of the challenges borne of the incredible torrent of deals heading to market is differentiation. What we mean is that there is nothing particularly compelling about this deal compared to others currently or soon to be trading in terms of asset type, employment, age, deal size, management or structure. Like Eagle Bulk, Quintana has signed MOAs and placed deposits on the eight modern panamax bulkers outlined in Figure 1 (Freshly Minted, VOLUME 1, ISSUE 17, May 5, 2005.)
Although we expect valuations to improve, the company shows strong asset and structural similarity to Diana Shipping, which suffered from bad timing in both the shipping and equity markets that may have been exacerbated by the fact that it was fully priced and sold into the wrong types of accounts. This must be a little unnerving for the sponsors, and we fail to understand how this deal will ever be judged on anything other than how much of discount it is offered at relative to Diana. Although Quintana does not indicate that it will use the model of a dry cargo version of Nordic American Tankers as Diana did, the company does plan to repay its debt in full upon consummation of the offering.
Perhaps there will be enough buyers to go around. There is nothing inherently wrong with the Quintana deal, but the sponsors will need to see valuations improve and have one heck of a good roadshow.
That said, with the firepower of Citigroup and Morgan Stanley behind them, who likely do lots of other business with the sponsors of this deal, it is unlikely that it will be sold into the accounts of hedge fund "flippers" as the Diana deal seems to have been.
Of Bridge Loans and Mezzanine
As we also wrote in our article about Eagle Bulk, these kinds of deals are not without risk to the sponsors as we cruise along a high point in the cycle. In fact, they involve a lot of risk. Unlike the Top Tankers IPO, in which the purchase of the Sovcomflot fleet was contingent upon a successful equity offering, both Eagle and Quintana involve the sponsors buying ships first and hoping they can get a premium in the future. In this case, the joint bookrunners have provided both secured debt and mezzanine facilities to result in 85% financing. This structure is not dissimilar in concept to the highly leveraged facility that Citigroup and Nordea provided to soon-to-be-public Genco, sponsored by yet another private equity firm, Oak Tree Capital.
Quintana entered into a $150 million bridge loan facility, dated as of May 3, 2005, with Morgan Stanley Senior Funding, Inc., not a regular player in the world of ship finance. In addition, the company entered into a new six-year three-month $262 million secured delayed-draw term loan facility, dated as of April 29, 2005, with Citigroup. The term loan facility consists of Tranche A, in an aggregate amount equal to the lesser of $213 million and an amount equal to 65% of the fair market value of the vessels, and a Tranche B, in an aggregate amount equal to the lesser of $49,210,500 and 15% of the fair market value of the vessels. The aggregate principal amount applied in respect of any vessel acquisition must not exceed 80% of the fair market value of the vessel. According to the filing, interest on amounts drawn will be payable at a rate of 1.625% per annum over LIBOR in respect of Tranche A and 2.50% over LIBOR in respect of Tranche B, for interest periods of 1, 2, 3 or 6 months or, if agreed by all lenders with commitments, 9 or 12 months. In the event the Tranche B term loans are not syndicated within 45 days, Tranches A and B will collapse into a single tranche and interest will be payable at a rate of 1.75% per annum over LIBOR.
Source:, Freshly Minted, VOLUME 1, ISSUE 17, May 5, 2005.)

Nice little earner from Stelios
Source: Lloyd's Register - Fairplay web links, 3 May 2005

OSG reports soaring income
---Overseas Shipholding Group, Inc. (NYSE:OSG) reported net income for the quarter ended March 31, 2005 of $164,919,000, or $4.18 per share, more than double the net income of $76,188,000, or $1.99 per share, achieved in the first quarter of 2004. EBITDA for the first quarter rose by 43% to $223,363,000 compared with $156,413,000 in the first quarter of 2004 and TCE revenue in the quarter increased by 41% to $267,187,000 compared with $188,982,000 in the first quarter of 2004.
"Net income more than doubled to $165 million in the first quarter compared with the prior year period and was better than net income for every full year in the Company's history except 2004," said Morten Arntzen, President and Chief Executive Officer. "This outstanding performance reflects strong operating results in our crude transportation business, healthy contributions from the 40 ships of the former Stelmar fleet beginning on January 21, 2005 and elimination of tax on the shipping income from our foreign fleet."
"This quarter was all about the men and women of OSG executing our strategy of striving to be the leader in those segments in which we compete -- international crude, products, U.S. Flag and LNG. We said we would outperform the public tanker sector this quarter and as a result of the performance by our crude segment, the Stelmar acquisition and the tax law change, we delivered on our commitment. We intend to do the same for the full year."
"In line with our commitment to build a world class product carrier business, we closed on the Stelmar acquisition on January 20, 2005. This acquisition added 24 product carriers to our fleet and gave us the scale we need to compete globally in this trade. The integration of Stelmar into OSG is proceeding seamlessly and, through the hard work of our employees, is generating revenue enhancements, expense savings and better ways to operate our business. The acquisition also strengthened our already first class crude transportation business by adding 13 Panamax crude tankers and three Aframax tankers."
"In line with our commitment to grow our U.S. Flag business, last month we announced the signing of a letter of intent to bareboat ten newbuilding Jones Act Product Carriers which will be built at the Kvaerner Philadelphia Shipyard. This is the largest commercial newbuilding program announced at a U.S. yard in many decades.
Source: Press Release, May 5, 2005

Excel Maritime takes physical delivery of two Panamax bulk vessels
---Excel Maritime Carriers Ltd , a shipping company specializing in the seaborne transportation of dry bulk cargoes such as iron ore, coal and grains, announced that it has taken physical delivery of two Panamax bulk vessels, MV Elinakos at Taichung, Taiwan and MV Happy Day at Kohsichang, Thailand.
MV Elinakos is a Panamax dry bulk carrier of approximately 74,000 dwt, built in 1997 in Japan; MV Happy Day, also a Panamax dry bulk carrier, is approximately 72,000 dwt built in 1997 in Japan. The Company agreed to acquire both on March 23, 2005.
CEO Christopher Georgakis commented, "With the deliveries of MV Elinakos and MV Happy Day, the Company has successfully taken physical delivery of five new acquisitions in April, with a further five deliveries remaining for the forthcoming weeks."
About Excel Maritime Carriers Ltd
The Company is an owner and operator of nineteen dry bulk carriers with a total carrying capacity of 1,211,570 mt dwt, after having taken delivery of all new acquisitions, and a provider of worldwide seaborne transportation services for dry bulk cargo. This includes commodities such as iron ore, coal, grains, as well as bauxite, fertilizers and steel products. The Company was incorporated in 1988 under the laws of Liberia.
The following table represents the existing fleet together with the new acquisitions:
Existing Fleet Name Dwt Year Built Type Delivery Date Fighting Lady 146,313 1983 Capesize Almar I 107,140 1979 Capesize Isminaki 74,577 1998 Panamax Birthday 71,500 1993 Panamax Powerful 70,000 1994 Panamax Renuar 70,000 1993 Panamax Elinakos 74,000 1997 Panamax Happy Day 72,000 1997 Panamax Lady 41,090 1985 Handymax Swift 37,687 1984 Handymax Goldmar 39,697 1984 Handymax Marybelle 42,552 1987 Handymax Lucky Lady 27,422 1975 Handysize Total 873,978 New Acquisitions First Endeavour 69,111 1994 Panamax Early May 2005 Angela Star 73,000 1998 Panamax Early July 2005 Forteza 70,000 1993 Panamax Early July 2005 Emerald 45,572 1998 Handymax Early May 2005 Princess I 38,385 1994 Handymax Late May 2005 Attractive 41,524 1985 Handymax Second Half April 2005 Total 337,592 Grand Total 1,211,570 Forward Looking Statement
Source: PIRAEUS, Greece, May 3 /PRNewswire-FirstCall/ --

Richards Butler sinks insurance fraudsters
---Richards Butler has recorded a victory in a highly unusual shipping case in which shipowners were found guilty of bombing their own vessel.
The North Star was damaged by a bomb in July 1994 while it was being repaired in a Greek shipyard near Piraeus. The bombing resulted in the loss of the ship.
The case was heard in the English High Court by Mr Justice Colman between October 2004 and February this year.
In the judgment, which was handed down on 22 April, Judge Colman dismissed the shipowners' claim, finding that the bomb damage was "attributable to the wilful misconduct of Mr Harry Petrakakos and the owners". He also found that the shipowners had failed to disclose the North Star's true value and that previous insurance policies had been refused.
Judge Colman added that he was confident Harry Petrakakos had been responsible personally for procuring, placing and detonating the explosives, and that the bomb had been placed inside the vessel rather than on the exterior of the hull.
It is understood that this is the first case to reject a claim under a war risk policy on the grounds that an owner has cast away their own ship.
Richards Butler head of insurance and reinsurance Mark Connoley acted for the insurers and instructed Nicholas Hamblen QC and Graham Charkham of 20 Essex Street. Shipping boutique Shaw and Croft advised the shipowners, with Quadrant Chambers' David Goldstone as counsel.
Source:, 2-May-2005

Greek Navy Investigates Incident on Norwegian Ship
---The Greek navy on May 2 sent armed forces to investigate an incident aboard a Norwegian cargo ship that could be an attack by pirates or a mutiny, a defense ministry source said.
The navy sent a frigate, a helicopter and a special forces team to the scene in Greek territorial waters southwest of the town of Pilos on the Peloponnese peninsula, the source said.
"The captain of the Norwegian vessel has sent a coded signal to Greek authorities which signifies that pirates have boarded his vessel," the source said. "Then the Norwegian consul asked for Greece's assistance."
But the source said a mutiny was also a possibility.
In Oslo, the Norwegian Shipowners Association said it had heard of the incident but its information was contradictory and it was too unclear to make any comment on.
"It is a very small ship," association spokeswoman Marit Ytreeide said.
The Greek navy has dispatched a surveillance plane to track the ship, some 80 nautical miles southwest of Pilos towards the Ionian Sea, a defense official said.
The ship has been ordered to sail towards the port of Pilos.
The merchant marine ministry confirmed the incident but could not give any further details. There were no details on the ship's cargo.

Hellenic Petroleum sees 2009 profit 500-600 mln eur
---ATHENS (AFX) - Greeces largest petrol refinery group Hellenic Petroleum said that it expects operating profit to double to 500 to 600 mln eur by 2009.
In a presentation to analysts, the company said that in the next five years its focus will include upgrading technology at its refinery plants in Greece and improving its local retail network.
Hellenic Petroleum operates four petrol refineries, three in Greece and one in Macedonia. It also has subsidiaries in Cyprus, Serbia and Bulgaria.
Source: Forbes , Source: , 05.06.2005, 10:29 AM

ELPE's hydrocracker to be operational by 2009
The CEO also said that he expects a strong Q1 due to strong refining margins in the second half of the period, despite the weak dollar, and he reiterated the company's target of doubling EBITDA in 2009 and lifting ROCE to above 10% compared with 2004 figures.
Source:, 18:23 - 05 May 2005 -