Greek Shipping News Cuts
Week 26 - 2009
---Posted : Fri, 26 Jun 2009 07:11:44 GMT. Author : DPA
Athens - The wife of a Greek shipowner was freed unharmed on Friday, a week after being kidnapped outside her home in Athens after her family paid an undisclosed ransom. The 73-year-old wife of shipowner Aris Theodorides was snatched after her car and driver was ambushed by two armed men in Paleo Faliro as she was being driven into central Athens.
The chauffeur was quickly released. The kidnappers then contacted the woman's family and demanded a ransom of 5 million euros (7 million dollars).
Reports said the woman was released unharmed in the early hours Friday after her family paid a ransom of 1.8 million euros.
Kidnappings are rare in Greece but the case of the shipping magnate's wife is Greece's fourth kidnapping of a prominent family in the past year.
In January, Greek shipping magnate Pericles Panagopoulos was freed unharmed a week after he was kidnapped when his family paid an undisclosed ransom.
Panagopoulos, 74, founder of Greek ferry operator Superfast Ferries, was abducted in broad daylight on January 12 by three men carrying Kalashikov assault rifles as he was being driven to work.
Last June, the chief executive of aluminium company Alumil was abducted and released two weeks later after a ransom was paid. A well-known doctor was also kidnapped last year but has yet to be found.
Anxiety Is High at NYC Shipping Conference
06/25/09 - 12:38 PM EDT
On the sidewalks outside the Pierre Hotel, the cigarette smoke rose and so did the anxiety. The people, mostly men in dark suits, were taking smoke breaks from the conference, called Marine Money Week, the annual shipping-business confab in New York sponsored by a maritime trade journal of the same name. The accents were Greek, Norwegian, Danish, Texan, Oxbridge -- and more Greek. The anxiety had to do with a massive multi-billion-dollar, industry-wide shortfall between the number of ships on order from builders, and the money needed to pay for those orders.
During the boom times, that money would have come from banks. In these times -- reports of thawing credit markets notwithstanding -- the banks were being intractable. At the conference on Wednesday, five banking executives found themselves in the awkward position of sitting at a table on a dais in front of a ballroomful of ship owners, and telling them, essentially, that their hands were tied.
"The commercial banks were up there saying, 'Don't come to us,'" said Omar Nokta, the shipping equities analyst at Dahlman Rose, a boutique investment bank that's co-sponsoring the conference. "The banks right now are just not willing to step up."
The numbers floating around the conference told the story. The industry as a whole -- from tankers to dry bulk -- had ordered $5 billion worth of new ships (anticipating, it should be noted, an economic turnaround -- a speculative play, in the opinion of some industry people). So far, only $2 billion of that had found financing.
One of the bankers at the session, which bore the title "Commercial Bank Summit," told the audience not to worry. "The gap will be filled in the next few months, in my view."
But he didn't indicate how that would come to pass, and, anyway, no one seemed to believe him. Of the banks represented on the panel, few were healthy: ING(ING Quote), Fortis, and HSH Nordbank, for example, were all bailed out to one extent or another by European governments.
As if to accentuate the point, the moderator of the panel, Philip Clausius, chief executive of First Ship Lease, of Singapore, closed the session with an appeal. "To all the banks in the room, I say: Repair your balance sheets. We need you."
It seemed as if the conference was turning on its head the traditional banker-client dynamic -- as the financial crisis has tended to do all over. The bankers hadn't come to the Pierre Hotel, situated at 61st Street and Fifth Avenue, across from Central Park, to sell their services to shippers. Shippers had come to the Pierre Hotel to plead with bankers to re-open their vaults.
As is sometimes the case, anxiety over one thing morphed into anxiety over its opposite. What if that order book does get filled, the attendees asked one another over their Blackberries, and what if all these new boats do come on line? Cancelations may in fact not occur, people started to worry at the conference. And if the economy doesn't turn around, won't there be way too much supply, and won't that lead to another collapse in prices, which had firmed of late?
The basis for this worry lie with the Chinese, none of whom appeared to be present at the Pierre. (Although, upon examining the list of attendees, one did see the name of a representative from the Hong Kong dry bulk shipper, Pacific Basin.) The Chinese government, it was said, was forking over incentive cash to Chinese shipping companies. And those shipping companies were, in turn, using that money to take over new-vessel orders at Chinese shipyards whenever a Western company canceled one due to lack of funds.
Order books, pricing, supply, demand, refinancing, restructuring: it was all on the conference agenda, and in the one-on-one "dealmaking rooms," off the main lobby.
Who went in? Presumably, certain dry-bulk shippers -- who have their own balance-sheet problems -- along with the banks that had loaned them money to expand their fleets during the boom. Like an LBO shop levering up a company in order to take it private, shippers had borrowed during the bubble against ships that are now worth less than a third of their value just a year ago. (Your average Capesize vessel was assessed last year at $160 million. This year -- pop -- it's worth $50 million.)
Loans like that are, as they say, under water. And some ship owners were most likely meeting with financiers during the conference to achieve waivers on those loans -- and to avoid insolvency.
There were attempts at brave faces, however. At an oil tanker panel toward the end of the day Wednesday, Morton Arntzen, chief executive of the Overseas Shipholding Group(OSG Quote), opened his speech by saying, "I tried to listen in on the sessions earlier this morning, but there was so much doom and gloom that I got depressed, and I left. Later, I talked to some of my sources at the New York Times and the Wall Street Journal, and I have confirmed: The future has not been canceled."
Among the executives at the conference were Angeliki Frangou, CEO of Navios Maritime Holdings(NM Quote), who also rang the closing bell at the New York Stock Exchange on Monday; Bjorn Moller, head of Teekay Corp.(TK Quote), who presented during the tanker panel on Wednesday afternoon; and Inger Klemp, chief financial officer at Frontline(FRO Quote), who did the same.
On Thursday afternoon, the drybulkers take the stage: Pankaj Khanna, COO of DryShips(DRYS Quote); Alan Ginsburg, CFO at New York-based hometown favorite Eagle Bulk Shipping(EGLE Quote) and John Wobensmith, Genco Shipping & Trading's(GNK Quote)CFO, will be panelists in a session called "The Dry Bulk Market."
Sceptics doubt finance choices
---WITH BANK lending scarce, shipping groups are pondering finance options such as private equity and bonds, but some believe these avenues could be dead-ends.
Some panelists touted the potential for more shipping involvement in bond markets, but HSH Nordbank deputy head of shipping Robin Das disagreed.
Source: Fairplay Daily News 25 Jun 2009
Greek selling outpaces buying
---Secondhand purchases by Greek owners are finally rising again but are being outweighed by ship sales.
There has been much talk in the secondhand market in recent weeks about whether Greek or Chinese buyers are in the ascendancy when it comes to ship purchases.
In the face of strong buying by Chinese owners, Greek purchases had slowed down but a rash of Greek panamax buys reported last week turned the tables.
Greek secondhand buying is currently much lower than in recent years, with local shop Allied Shipbroking this week reporting a total of 97 purchases this year at a total investment of almost $1.6bn.
Another Greek broker, Golden Destiny SA, lists 75 ships as sold to domestic buyers up to the end of May.
TradeWinds research shows that to date this year, more than 100 purchases reported - but not all confirmed - were to Greek buyers.
However, it is also clear that Greek owners are in a selling mood, with sales outstripping purchases by a ratio of two-to-one and many ships going for demolition.
The trend shows that larger companies are offloading older tonnage but not necessarily replacing them and that medium-size and smaller Greek companies are selling off their old ships but are, in many cases, taking advantage of lower prices to replace them with younger vessels.
Having started its disposals in 2008, Diamantis Diamantides-controlled Marmaras Navigation has weeded out nine 1980s-built ships from its fleet so far this year, five of which have gone for further trading and the remainder to the breakers. The sales leave the company with six 1980s-built bulkers out of a total 27. No replacement tonnage has been added to the fleet.
Thanassis Martinos's Eastern Mediterranean Maritime (Eastmed) has also sold ships, with three said to have gone for further trading and one for scrap. However, Eastmed had already started buying younger tonnage at the end of last year after a long fallow period, and has effectively replaced the three oldest bulkers in its fleet as well as getting rid of its oldest and only single-skin VLCC.
But a number of smaller companies are also making moves. Firodi Shipping, which saw the year in with a fleet of three bulkers and a cargoship all built in the early to mid-1980s, has sold two vessels and paid a reported $14m to purchase a 32,000-dwt bulker built in 1997.
Optima Shipbrokers director Dimitris Koukas points out that a number of companies either did not move or bought carefully during the dry-market boom, and are now taking advantage of the lower asset prices to buy younger ships.
Also, companies with old tonnage are benefitting from the recent spike in the market to offload ships that will not be viable propositions when the freight market comes back.
"Selling one or two of these, you can get a [replacement] ship that you feel, even if there is a downturn of the market, you have time to wait for the recovery," he said. "If you have the cash flow to support it, it's a win-win situation," he added.
Trade Fortune has sold two of its five ships - one 1977-built unit for demolition and an 1980s-built bulker for further trading - and snapped up the 52,000-dwt Mimosa (ex- Lowlands Mimosa , built 2002) for a reported $23m. The remaining three bulkers in its fleet are mid-1980s built.
Vita Management, a company that kept its head down during the hot freight market, has this year sold a 1981-built panamax for breaking, getting a higher price than it paid for the ship in 1999. At the beginning of the year it splashed out $25m to buy the 74,000-dwt Vitaspirit (ex- Chorus , built 2001) and is said to have also acquired the 76,000-dwt Yomoshio (built 2001) for $23.7m.
Pendulum Shipmanagement, which at the beginning of the year was listed with a fleet of nine bulkers and cargoships built in the late 1970s and 1980s, has disposed of four ships but so far has shown no appetite for replacements.
Brokers suggest that some of the second-tier banks that lent to Greek owners overextended themselves during the high market and are now cautiously lending again in order to achieve a better average-age fleet exposure with their clients. But a high percentage of the spend on younger ships is being self-financed, they say.
By Gillian Whittaker Athens
Published: 23:00 GMT, 25 Jun 2009 | last updated: 12:33 GMT, 25 Jun 2009
Full impact of Eastwind bankruptcy yet to become clear
---The immediate impact on management companies associated with bankrupt New York-based Eastwind Maritime, and 55 affiliates, is not clear, though Piraeus-based Eastwind (Hellas) SA says it "faces cash flow problems" as "management fees are unpaid".
"It will be a struggle but we will continue and in time the situation will become clearer," said Efstratios Glyptis, md Eastwind (Hellas). He confirmed that of the 18 ships under the office's technical management, 12 are Eastwind ships.
Eastwind Maritime filed for Chapter 7 bankruptcy liquidation in New York, June 24, the day after Finland's Nordea Bank, New York branch revealed the foreclosure and sale of 13 of its ships. The troubled New York-based owner filed the petition in a US federal court and though court documents do not give exact numbers as to the company's debt, it says it is between $500m and $1bn and lists assets in the same range.
It is not immediately clear from the terse filing whether there are elements of the Eastwind group which are not included in the bankruptcy. In addition to Piraeus, Eastwind uses competitive management offices in Singapore, China and Japan.
The documents did not give a reason for the bankruptcy, saying "...in the judgment of the board of directors, it is desirable and in the best interests of the company, its creditors and other interested parties that the company file a petition for relief and commence a case under the provisions of Chapter 7 of the Bankruptcy Code".
Founded over 20 years ago by Japanese interests and John Kousi, the company has asked Judge Allan Gropper, of the southern federal district in New York, to allow it extra time to file a list of 200 to 999 creditors. Among the listed affiliated companies is 10-ship Eurus Container Carriers, which was also among the companies Nordea revealed the previous day it had sold to Sammy Ofer's Monaco-based Samama's Draften Shipping for an undisclosed price. Two bulkers and a reefer also went to Samama. In the weeks leading up to Eastwind's filing, the group has suffered lawsuits, vessel arrests and the loss of a Russian management contract involving 12 reefer ships. -- See 'S&P Commentary', page xxxx
Clarkson Research lists Eastwind Maritime as controlling 56 container ships, reefers, bulk carriers, fish carriers and chemical tankers, including newbuildings.
Glyptis confirmed three of the units that went to Ofer were managed by the Piraeus office and that the company had been informed that the management of the ships will not be moved.
Chiquita said it does not expect Eastwind's bankruptcy filing to affect any of its shipping operations. Chiquita sold its fleet of 12 ships -- eight reefers and four container ships -- in May 2007 to an alliance between Eastwind Maritime and NYKLauritzenCool for $227m. Under the deal Chiquita leased back 11 of the ships for seven years, with options for up to an additional five years. The twelfth ship was taken on period charter for three years with options for an additional two years. Collectively, the 12 transport about 70% of Chiquita's banana volumes to Europe and North America.
-- Filed: 2009-06-25
Climate change on Greek cabotage?
---Monday, 22 June 2009 14:06. Is the climate in Greece changing over cabotage? When former Greek Minister of Tourism Development, Aris Spiliotopoulos, spoke firmly last year in his address to the CruiseinGreece forum in Athens about the necessity of lifting all cabotage restrictions in cruising, most people present - including senior cruise executives - couldn't believe their ears.
Aries Maritime Transport Limited Signs Letter of Intent for Acquisition of Control by Grandunion
---ATHENS, Greece, Jun 24, 2009 (GlobeNewswire via COMTEX News Network) -- Aries Maritime Transport Limited (Nasdaq:RAMS) today announced that it has entered into a non-binding letter of intent with Grandunion, Inc., a company controlled by Michael Zolotas and Nicholas Fistes, that contemplates, among other things, the acquisition of three Capesize drybulk carriers with an approximate net asset value of $36.0 million in exchange for 15,977,778 newly issued shares of the Company, and a change of control of the Company's Board of Directors.
Upon closing the transaction, Mr. Fistes would serve as the Chairman of the Board of Directors, and Mr. Zolotas would serve as a member of the Board and President of the Company. Grandunion would also designate the Chief Financial Officer of the Company and four out of seven members of the Board (including Messrs. Fistes and Zolotas).
The letter of intent is subject to a number of conditions, including (a) the receipt of a commitment letter from a bank for a fully underwritten private issuance of $145.0 million aggregate principal amount of 7% Senior Unsecured Convertible Notes due 2014 (the "Notes"), the proceeds of which would be used primarily to fund vessel acquisitions and partially repay existing indebtedness; and (b) obtaining certain amendments to the Company's existing senior credit facility.
The letter of intent obligates the parties to negotiate in good faith, but does not obligate them to complete definitive agreements or to close the transaction. The letter of intent provides for a binding 60-day exclusivity period and a $3,000,000 break-up fee payable to Grandunion in certain events. The exclusivity period will terminate if Grandunion is unable to procure a signed commitment letter to fully underwrite the $145.0 million in principal amount of the Notes and certain amendments to the Company's existing credit facility. The letter of intent may also be terminated if no definitive agreement has been entered into by August 31, 2009.
M/V Hellenic Sky time chartered at us$18,000 per day for 13-16 months
The time charter agreement with Cargill for the M/V Hellenic Sky is for a period of minimum 13 to about 16 months at a gross rate of US$18,000 per day. The charter commenced on 22 June, 2009 and the earliest expiration date is 22 July, 2010.
Following the time charter of the M/V Hellenic Sky, the estimated time charter coverage for the remaining of 2009 is 90% and 59% for the whole of 2010.
To view The deployment of the Hellenic managed fleet, go to: http://www.hellenic-carriers.com/files/hc_24_06_09.pdf
Source: Hellenic Carriers Limited Fleet Deployment Update Press Release 24 June 2009
Dahlman Rose & Co: Navios Maritime (NM) - Acquisition of Four Capesize newbuilds; Reiterate Buy and $8 Target
>Navios announced several developments yesterday, including the acquisition of four Capesize newbuilds partially financed with $165.2 million new convertible preferred shares.Additionally, $52.8 million of the convertible issuance will partially finance three existing Capesize newbuildings. The 4 newly-acquired newbuilds are set to deliver between 3Q10 and 1Q11 at a total cost of $324 million. The remainder of the purchase price will be financed through a new $240 million credit facility from Commerzbank, which is also the seller of the contracts.
>All four Capesize newbuilds will be delivered with time charters of at least 5 years in length attached.Three will have time charters in excess of 10 years paying $29,356/day, with 50% profit sharing arrangements above roughly $38,000/day. The fourth comes with a 5-yr contract paying $52,584/day. Its core fleet is 98% contracted for 2009 and 78% contracted for 2010.
>The dry bulk market has strengthened considerably.Steel prices in China remain the primary driver behind record iron ore imports and strong freight rates, with Chinese rebar prices rising from $480/ton to $550/ton since April. Capesize spot rates are currently trading above $80,000/day and we expect further increases in asset values in the coming weeks. A 20% increase in ship prices puts 5-yr old Capesize values at $65 million, which implies an NAV for Navios of $12/share.
Source: Dahlman Rose & Company LLC <firstname.lastname@example.org>
Greek behind MR Tanker orders at STX
---Date: 24 Jun 2009. The Greek controlled company Standard Development, described by brokers as a "new name" in shipping, is said to be behind an order at STX Offshore & Shipbuilding for up to eight medium-range (MR) tankers.
The contract is interesting because it would mark the first investment in newbuildings from Greece so far this year. German and Greek investors have been the top newbuilding players for the past three years but neither opened their wallets during the first five months of 2009 apart from Munich-based Premicon's order for six large river-cruise vessels at Volkswerft Stralsund.
Four of the MRs, a standard 50,000-dwt STX design, are firm, the others are options.
Broking sources say the 2010 delivery slots were secured because of existing orders being postponed. It is, they say, a new order and not a previous deal being reworked.
STX has promised to disclose the buyer's name soon but for the time being it is keeping the principal's identity private. However, one London-based broker said about the price tag: "I don't know why you would pay $42.5m for an MR when you could probably buy one for $40m on the resale market,"
Another added: "$42.5m is not exactly cheap for these vessels. MR tankers are quite heavily ordered and I wouldn't make it my first choice to order but there are people out there who feel clean products is definitely the way to go rather than going for dirty."
Attica Group order the building of two new vessels for the Greek Market
---The Board of Directors of Attica Group S.A. is pleased to announce the agreement with Daewoo Shipbuilding and Marine Engineering Co. Ltd. (DSME), Korea for the building of two new fast car-passenger ferries. The signing of the shipbuilding contracts will take place on Thursday 25th June 2009. The ships will have overall length 145.5 meters and speed of 26 knots and the capacity to carry 2,400 passengers and 450 private vehicles or 50 freight units and 150 private vehicles.
The Board of Directors. For more information please contact:
Tel.: +30 210 891 9500
Fax: +30 210 891 9509
Drewry Report on State of Shipbuilding
How many ships are needed?
A matter of timing: the dry bulk experience
But for the moment all eyes are on the next five years and dry bulk provides a good example of the problems confronting shipbuilding and shipping alike.
At the beginning of 2009 there were 6,864 bulk carriers in service, with a combined deadweight of 422 million tonnes. Despite a steady stream of newbuildings, the fleet is old with an average age of 16 years. Although most tonnage will not be scrapped at least until it reaches 30 years of age, there is already a considerable number of ships in excess of 20 years of age. Given the severe downturn in the dry bulk freight market, scrapping in this sector can be expected to pick up and in the period to 2013 total removals could well be in the order of 60+ million dwt.
If dry bulk trades were to grow at the rates seen in the period 2000-08, it would generate incremental new ship demand for approximately 100 million dwt over a five-year period.
However, the latest projections suggest that over the next five years trade growth is likely to generate new demand closer to 50 million dwt. To this figure you must of course add demolitions over the period, but even then the combined total will make only a small dent on the 300 million dwt that is currently scheduled to be delivered between now and the end of 2013. As such, do not expect trade growth to save the dry bulk market.
The rate of deletions in sectors such as container ships will remain low due the younger nature of the fleet despite the appalling conditions. A similar, though less extreme situation exists in the tanker market.
The current orderbook and scheduled deliveries indicate that some 197 million cgt of new tonnage will be built and delivered by the end of 2013. At the moment there is a strong possibility that perhaps as much as 20-30 million cgt will be cancelled, reducing the amount that will be delivered to 170-175 million cgt. Some 14% of the orderbook is currently at some appreciable risk of cancellation.
Sea NG to transport CNG to Crete
---6/26/2009 2:15:20 PM GMT. CAIRO, EGYPT: MEDCARRIER S.A.E. has selected Calgary, Alberta-based Sea NG Corp. to provide the transportation service for its proposed project to deliver natural gas to the island of Crete. MEDCARRIER will be using Coselle-type CNG ships operated by Sea NG to transport natural gas from Egypt to markets in the Mediterranean region.
The move comes one week after Public Power Corporation of Greece (PPC) approved a Memorandum of Cooperation (MoC) with MEDGAS S.A. to further evaluate the long-term supply of Crete's existing and new power generation units with marine compressed natural gas (CNG) as an alternative solution to the supply of liquefied natural gas (LNG). MEDGAS is the marketing partner of MEDCARRIER in this project.
"We have completed our extensive evaluation of marine CNG transport and are pleased to announce the selection of Sea NG as the provider of marine CNG transportation for the project. The MoC between PPC and MEDGAS allows MEDCARRIER and Sea NG to proceed with the final feasibility study and the coordination of resources for the project to transport CNG from Egypt to the island of Crete", said Hisham Radwan, vice chairman and managing director of MEDCARRIER.
MEDCARRIER S.A.E. is a joint venture Egyptian company with ownership by Egyptian Natural Gas Holding Corp. (EGAS), Arabia Gaz of Egypt, and the Copelouzos Group of Greece. The company's main business is the processing, loading, and transport of CNG from Egypt to locations in the Mediterranean region.
Sea NG Corp. transports natural gas using its proprietary Coselle technology. Coselle CNG ships enable economic gas delivery to smaller gas markets such as island communities and industrial consumers, and also have applications to enhance the value of marginal and stranded gas fields.