Greek Shipping News Cuts
Week 37 - 2008


Greece appoints new minister of Merchant Marine

---Nigel Lowry, Athens - Friday 12 September 2008
Mr Voulgarakis quit after days of mounting criticism amid allegations of unethical real estate dealings by companies tied to the then-minister.
A week ago, a clearly rattled Mr Karamanlis had stood by his embattled minister but criticism from senior figures in the ruling party was barely being contained.
Mr Voulgarakis, who came to the shipping ministry a year ago after terms as Minister of Public Order and then Culture, was defiant in his valedictory letter, claiming he resigned to protect the government from slander.
Allegations against Mr Voulgarakis were the culmination of a series of alleged scandals that have brought the governing conservatives low in opinion polls.

Athens: 36 Speakers to present at biggest ship finance event of the year in southern Europe
The biggest ship finance event of the year in southern Europe will take place in Athens, Greece on Thursday 9 October 2008. For the 10th concecutive year Marine Money's Greek Ship Finance Forum presents an impressive and topical Agenda.
Amongst the speakers at the conference will be the CEOs of many of Greece's foremost public and private shipping companies, leading commercial and investment bankers and many other leaders in the field of shipping, ship broking and chartering, shipping finance and shipping law. The morning session will be devoted to a discussion on where the $300 billion of funds will come from to pay for the current order book. The day will close with a session on alternative sources of finance including Islamic finance for Greek ship-owners and the Athens Stock Exchange as an option for companies going public.
Speakers include:
Mr. Michael G. Alexiou, Managing Partner, Alexiou & Co.
Mr. Ulf B Andersson, Head of Shipping, Nordea Bank Finland Plc, London Branch
Mr. George Arcadis, CEO & General Manager, Fortis Bank Greek Branch
Mr. Anthony C. Argyropoulos, Managing Director, Cantor Fitzgerald & Company
Mr. Tony Backos, Partner, International Corporate Group, Watson, Farley & Williams
Mr. Gust Biesbroeck, Global Head Transportation, Energy Commodities and Transportation, Fortis Bank N.V.
Miss Cindy Cahill, Partner, Climate Change and Sustainability, Deloitte & Touche
Mr. Ronald Dal Bello, Senior Vice President, First Ship Lease (Switzerland) AG
Mr. Sotiris Dushas, CEO and President, Alba Maritime Services SA
Mr. Brett M. Esber, Partner, Blank Rome LLP
Mr. Elliott Etheredge, Executive Director, J.P. Morgan
Ms. Angeliki Frangou, Chairman and CEO, Navios Maritime Holdings Inc.
Mr. David E.K. Frischkorn, Jr., Vice Chairman-Corporate Finance, Dahlman Rose & Co. LLC
Mr. Joseph M. Giacobbe, Managing Director, Investment Banking, Banc of America Securities LLC
Mr. George D. Gourdomichalis, President, G. Bros Maritime S.A.
Mr. Erik Helberg, Head of Shipping Research, Pareto Securities ASA
Mr. Spyros Kapralos, President, Athens Stock Exchange
Mr. George Karageorgiou, CEO & Co-Founder, Globus Maritime Limited.
Mr. James R. Lawrence, President of MTI Network and Chairman of Marine Money International, Marine Money International
Mr. Ioannis Lazaridis, CFO, Capital Product Partners LP
Mr. Michail Livanos, CFO, Grandunion Inc.
Mr. Evangelos M. Marinakis, Chairman, Capital Product Partners L.P.
Mr. Christos Megalou, Managing Director - Investment Banking, Credit Suisse Securities (Europe) Limited
Mr. Andrew Meigh, Managing Director - Investment Services, Clarkson Investment Services
Mr. Stamatis Molaris, CEO, Excel Maritime Carriers Ltd.
Mr. Hamish Norton, Managing Director and Global Head of the Maritime Group, Jefferies & Company, Inc.
Mr. Georgios Papadimitriou, Partner, Ernst & Young (Hellas) S.A.
Mr. Andreas Treede, First Vice President, KfW IPEX-Bank GmbH
Mr. Nikolas Tsakos, President & CEO, Tsakos Energy Navigation Limited
Mr. Guy Verberne, Head of Economic Research, Fortis Bank
Mr. Gary Wolfe, Partner, Head of Capital Markets Group, Seward & Kissel LLP
Mr. Theo Xenakoudis, Managing Director, International Registries, Inc./Marshall Islands Registry
Mr. Erhan Zeyneloglu, Executive Director, Structured Finance Dept., GarantiBank International N.V.
Mr. Michael Zolotas, CEO, GrandUnion Inc.
The Event Agenda together with the Registration Form and other practical information are available on the Marine Money website at:

Greek owners on edge as C&Heavy Industries faces dire straits
The stock listed yard focused predominantly on 81,000 dwt bulk carriers. With finance suddenly drained the yard failed in August with an effort to raise bonds.
Its first newbuilding is an 81-type bulker ordered by Greek owner Target Marine, with its construction having already started. It was initially scheduled to be completed toward the end of this year, but construction has been severely delayed. As of the end of June 2008, C&HI had 62 ships on backlog, amounting to $3.3 billion. [11/9/08]

Greek Sale & Purchase by Newsfront
---With secondhand prices of dry ships expected to soon follow falling freight rates brokers report an increase in the number of ships being circulated for sale. At the same time the number of deals being struck has dropped-off and buyers and sellers try to set market levels.
Dry ships of all types are appearing on the market and prices are still firm with many of the ships leaving Europe for the Far East. Panamax tonnage in particular is being circulated while older smaller ships are alreadymoving on. SeastarChartering sold the Orna, a 27,915-tonner built 1984 in Japan, to undisclosed buyers for a reported $18.5m. Everlast Shipping negotiated the Road Runner, 25,140dwt, built 1983 in Japan to Indian buyers for $19m. Brokers report all eyes are on Everlast which is also selling the 28,500dwt log-fitted bulker Allstar, built 1990, and trying to get the $17.5m it paid for the ship less than two years ago.
London's AIM-listed Globus Maritime is moving on tonnage. It has confirmed a deal in which it doubled its money with the sale of the the 43,200dwt Ocean Globe, built 1995, to Greek operator Nikator Navigation for $52.25m. Globus bought the ship from the Restis group mid-2006 prior to launching its IPO, for $25m. Globus said September 10 itmade a capital gain of around $30m. Perhaps cheered by this Globus is set to sell at least one more of its eight bulkers, with brokers saying the 43,000dwt Lake Globe, built 1994, could be the next to go.
US-listed DryShips is said to be looking for buyers for its 73,000dwt bulker Ocean Crystal, built 1999, which was acquired for $31.5m in October 2004.
It was a busy week for StealthGas and boss Harry Vafias. In addition to launching the Nasdaqlisted company into the suezmax sector with an order for up to four ships (See 'Newbuildings') Stealth- Gas has confirmed purchase of a 50,500dwt product tanker resale from Denmark's J Lauritzen. The ship is one of four same-sized units on order China's Guangzhou Shipyard and will deliver in November 2009. No price was revealed for the ship which will enter a three-year bareboat charter to Far Eastern interests. StealthGas has also confirmed selling the 6,562cubmtr Gas Amazon built 1992 for $11m.
Vafias said the sale "will free up cash resources, reduce somewhat our debt and help in keeping the average age of our fleet well below the industry average".
Chartworld Shipping/Lou Kollakis bought two reefers from Tokyo-based Nippon Yusen Kaisha (NYK) as part of a double back-to-back sale. A reported $50m enbloc has been paid for the 1993-built 644,300cuft pair Dominica and St Lucia though details of the bareboat-charter were not disclosed.
US-listed Seanergy Maritime has announced it has taken delivery of the Bremen Max, a 1993 built, 73,503dwt unit. The vessel is chartered at the rate of $65,000 a day to September 2009 to South African
Marine Corp, an affiliate of the Restis group. Athens-based Seanergy was initially formed for the specific
purpose of acquiring a business in the shipping industry. It subsequently agreed to purchase six dry bulk carriers, which include two 2008 built vessels, from companies associated with members of the Restis family. It now has two panamax, two supramax and two handysize vessels of a total 317,743dwt.
As week 37 ended, the market was buzzing with news TOP Ships has put what remains of its tanker fleet on the market. In all eight ships remain, following a stream of sales over recent months as the fleet was reduced from in excess of 2m dwt. At the same time, the Evangelos Pistiolis-led Athensbased company has been building up its dry cargo fleet. At the end of last year the company was renamed TOP Ships from TOP Tankers to better reflect its activities.
Source:, 12 September 2008

---International Maritime Union, members of which is the majority of the shipping companies representing liner shipping companies as well as tramped ones, warned that jobs may be lost, since companies have been reporting earnings decline of more than 50% from the beginning of 2008. This development is attributed to the continuing work stoppages and strikes by workers in the port of Piraeus.
Source: September 12, 2008,

Globus offloads
---Globus Maritime has more than doubled its money with the sale of a bulk-carrier to a compatriot owner.
The London-listed Greek has offloaded the 43,200-dwt Ocean Globe to Nikator Navigation for $52.25m.
Globus chief executive George Karageorgiou had dropped a hint in an interview with TradeWinds TV last week that the company may sell one or more of its handymaxes which operate in the spot market (click here to view the web TV interview) .
The 1995-built bulker will swap hands some time between the end of September and the end of November this year whenever Globus decides to pull it off spot charter. It currently earns an estimated $41,000 per day in the spot market.
The Greek owner will sit on the cash until such time as it can find a younger and larger ship.
Norwegian analyst firm Pareto Securities called the $52.25m price tag "very firm in the current market environment" as the "dry-bulk peer group is currently trading at 60% of [net asset value], implying 33% drop in vessel values (adjusted for debt financing of assets)".
The Ocean Globe made headlines in January 2007 when it ran aground in the Bay of Cadiz off Spain with 38,000 tons of coal and 600 tons of bunker fuel onboard (click here to read related article) .
By Eoin O'Cinneide in London, Published: 07:31 GMT, 10 Sep 2008 | last updated: 09:14 GMT, 10 Sep 2008

StealthGas branches into crude
---THE GREEK liquefied petroleum gas operator StealthGas will enter the crude sector through the order of two Suezmaxes and has announced several additional fleet developments.
StealthGas has ordered two 156,000dwt Suezmaxes from a Chinese builder for delivery in 2011, with options for two sister newbuilds in 2012. The company has also acquired a resale 50,500dwt MR product carrier for delivery in November 2009.
StealthGas also announced five new LPG charter arrangements today, four of which are 13-30% higher than existing rates.
Source: Fairplay Daily News 11 Sep 2008,

We disagree with this assessment believing the current market reflects a herd instinct and an avoidance of betting against the tape.
The companies presenting at the conference are all clearly differentiated from spot players, with visibility of earnings and cash flows yet their shares have also been pummeled as the BDI continues its decline. Mr. Rose exhorted the crowd to take advantage of this anomaly, take a reality check and not to trade on fear.
Following Mr. Rose to the podium, Omar Nokta gratefully acknowledged the fact that the audience was taking time away from their screens to learn more. He reiterated the theme of sound fundamentals versus panic noting we were heading into the coal and grain seasons. He also felt that China would soon start up again, a recurring theme throughout the day, but acknowledged the headwinds of the slowing economies in the United States, Europe and Asia.We wonder if it is possible that there is both too much and too little information, particularly in the case of China.
Even if we had a screen these days, we would not want to look, so we sat back and enjoyed an excellent series of presentations.
Reflective of the issues above, we noted that these presentations minimized financial results and instead focused on strategies, strengths and metrics, which differentiated the company from its peer group. Perhaps another reason is of course the fact that second quarter numbers are dated. Generally the tone of these presentations was that this market would soon pass, hopefully by the 4th quarter. Another theme and perhaps more pressing was the availability of financing to the industry.
Below we have extracted from the various presentations, facts and insights that grabbed our attention.
Everyone today is worried about bunkers and ever increasing crew costs. Eagle however has a different perspective. Instead of focusing on operating expenses per se, their goal is to have the lowest cash breakeven operation. Realizing these are expensive assets, which generate millions in revenues, they question whether it is logical to have the cheapest crew operating these vessels, a thought similar to having a nuclear submarine built by the low cost bidder. By paying more they believe they attract better crews.
He believes the credit crunch had a cleansing effect. New and greenfield yards are having difficulty obtaining financing and refund guarantees and owners too are having similar difficulties. The net effect is the cessation of speculative orders and a tightening of supply. Mr. Tsirigakis also highlighted the disconnect between spot and period rates which suggest that the industrial players have confidence in the market.
Presenting on behalf of Excel Maritime was Stamatis Molaris who highlighted how different Excel is as a consequence of the merger with his former company Quintana. And even more astounding is the fact that the full effect will not be seen until the third quarter. Every metric used is a huge multiple of the prior comparable period.
Whereas previously Excel was a proxy for the spot business, today that is no longer the case. Utilizing a different perspective, one
slide shows the cumulative number of vessels available per quarterfor employment in the spot market. Over the next two years the percentage of the total fleet ranges from approximately 25% to less than 50%. Bankers have no worries with the fixed fleet covering all the fixed charges including drydockings and then, of course, there is the upside from the open vessels for the shareholders. Also comforting was the rapid pay down of the debt associated with the acquisition that amounts to some $500 million over the next three years.
Finally, Mr. Molaris provided an interesting case study of the yard situation. Excel has ordered 8 Capesizes, four in established yardsand four in greenfield yards. The latter have failed to provide refund guarantees and he expects that deliveries will be delayed by two years if they are built at all.
Sai Chu of Seaspan also wanted to make it clear that his business has nothing to do with the BDI. In fact, being part of the ocean highway, it is more a globalization and infrastructure play. Seaspan is an outsourcing provider to the containership industry, which wants high value assets at low cost. For Seaspan the focus is on growing distributable cash flow to deliver value to its shareholders.
As the market leader among independent containership owners, Seaspan sees many opportunities for growth. Public companies control only 5% of the market and many competitors are struggling. And perhaps even more interesting is the fact that when times are difficult, the liner companies tend to look to outsiders for capital increasing the share of outsourcing.
Given the constant questions about counterparty risk that Mr. Chu has been asked recently, we were astounded to learn that vessel charter cost only represent only 15% of total operation expenses versus bunker fuel which is 30-40%. We were also interested to learn that Seaspan had foreknowledge of the economic slowdown last summer when the lines started re-deploying their fleets.
Unlike Seaspan, Danaos provides market share data of the top 20 containership charter owners which includes the German KGs. To say the German KGs, taken together, dominate the market is an understatement.
Danaos also differentiates itself from Seaspan by employing assets both on short term and long-term basis. It seeks longer charters for high priced assets but goes short when they consider the market soft. Looking at visible earnings, Danaos is 100% covered until 2010 and has over 75% cover until 2017.
Although it trades dry bulk vessels, Britannia Bulk could not be more different from its peers according to Arvid Tage. First it specializes in the Baltic trades, where it has a leading market position. Mr. Tage attributes this to its expertise in trading in icy condition, its focus on cargo movements and logistics and its customer relationships.
All in all we found this to be a very informative day. And when we got home, we saw that shipping stocks were generally up so being away from the screen was not a bad thing.