Greek Shipping News Cuts
Week 38 - 2009
---Despite the challenges of the worldwide economic crisis, Greek shipping continues to make steady progress as the modernisation and diversification of the Greek-controlled fleet continues. "The national flag has been re-enforced by the introduction of some 2m gt in newbuildings and younger tonnage," declared owners after a joint meeting of the Union of Greek Shipowners and Greek Shipping Co-operation Committee.
"The Greek registry, built on a steady legal framework, is the basis of the development of Greek shipping and it is very important to support the flag by bringing in new and modern vessels," said the owners in a joint statement after their September 14 meeting in Piraeus.
The owners said "every effort must be made to ensure the success of this". "Renewal of the Greek-owned fleet and its ongoing diversification means it is able to cover all the seatransportation needs and this is a very positive development," said the owners.
They said that while the sudden collapse of the freight market in the final quarter of 2008 brought an end to a rare period of wellbeing for the shipping sector and introduced intense instability in the market, "traditional experience" coupled with "sound decision-making" has enabled Greeks to avoid laying up ships in big numbers while maintaining employment positions.
In fact, the owners contend "shipping must be considered the sector which has not contributed to unemployment". Indeed, the modern fleet faces a lack of bridge officers and, encouraged by the results in 2008 of a drive to attract young people to shipping, efforts are being continued this year in conjunction with the Marine, Aegean and Island Policy ministry to reshape training with the aim to better prepare people, with the private sector having a decisive role.
As the end-of-year conference on the environment to be held in Copenhagen approaches, Greece's shipping leaders believe new ways of tackling emissions have to be explored, with Imo deciding on measures "which are practical and cost-effective and that are applied to all vessels no matter the flag it flies".
"Measures must be based on a correct social-economic approach, for if seatransportation becomes too expensive, the transportation of goods will be moved to other modes which are less environmentally friendly," warn the owners.
They reiterated Greek shipping's opposition to emission trading schemes, "because the character of shipping makes it impossible for them to be applied" while they "do not provide an effective improvement to the environment". The owners instead support Imo's plan to impose a fuel tax and build up a fund to support activities to protect the environment.
The owners also expressed fears that the end of the monsoon season will see an increase in acts of piracy, despite international efforts to curb the menace.
-- Filed: 2009-09-16.
NBG on shipping sector
---ANA-MPA/The most remarkable expansionary cycle in recent shipping market history ended in the second half of 2008, when the more severe phase of the international financial crisis hit the world economy hard, driving dry bulk freight rates down 93 per cent from their historical high reached in June 2008, and 76 per cent below their 10 year average, the National Bank of Greece said in its monthly bulletin Thursday.
Nevertheless, the upturn in demand for commodities from China in the first half of 2009, and successful short-term supply management practices by shipowners, triggered a strong rebound in dry market freight rates in second quarter of 2009, (up by 360 per cent in late-August despite the significant correction during the July-August period).
The NBG analysis suggests that the current level of freight rates is not sustainable unless large adjustments take place on the supply side, in the form of cancellations of high outstanding ship orders, as well as increased scrapping.
Specifically, despite NBG Research's estimated pick-up in demand for dry bulk shipping by 6.3 per cent y-o-y during 2010-2011, and an estimated level of cancellations equal to 100 million dwt during 2009-2011, combined with scrapping amounting to 70 million dwt (out of a total bulker fleer size of 418 million dwt), the BDI level is projected to fall below 2000 in 2010 before rising to 2750 in 2011, approaching its 10-year average of 2870 - a respectable outcome in view of the size of the initial disequilibrium.
Similarly, in the tanker market, the NBG Research projects that demand will pick up by 5.3 per cent y-o-y between 2010-2011 and that about 35 million dwt of single-hull tankers will be scrapped (out of a total tanker fleet size of 390 million dwt as of end-2008), in conjunction with order cancellations of about 40 million dwt, thus pushing tanker freights 45 per cent above their current relatively depressed levels, but to 20 per cent below their 10-year average.
With Greek shipowners expected to participate proportionately in the supply adjustment, total revenue from the shipping sector in the Greek economy is not projected to recover until 2011, implying that the Greek merchandise shipping sector will exert a net drag on Greek GDP growth of about 0.4 of a percentage point in both 2009 and 2010, and will have a positive contribution of 0.3 of a percentage point in 2011.
Discovering second-hand bargains during the recession is pivotal for Greeks that can afford it, but they are proving pickier than the Chinese: tonnage must be young and of good quality to be considered.
Ironically, it may be this concern for the quality of their fleet that eventually leads to Greek shipowners losing their dominance.
Source: Fairplay Newswatch 17 Sep 2009
Greeks order six Samho bulkers
Petrobas Deal With Tsakos
The Greek shipping company, which is active in the tanker market with a fleet that currently exceeds 47 double hull tankers, agreed to extend the time charter for Pentathlon, which was constructed in 2002.
Based on the deal, the company will profit at least $15.5 mil. euro while there is the provision for profit sharing, if the market reaches higher levels than the ones prescribed in the deal.
This deal coincides with a period where the impact of the crisis on the tanker market is becoming more intense an the shipowners are under pressure, pushing charters down towards record low.
For some ship types and for certain categories, charters have dipped as much as 50%..
Diana sees banks thaw on lending
---A dry-bulk duo see a melt in sight but others say credit remains scarce.
The long freeze on shipping lending is showing the first signs of melting, at least in the eyes of one of the world's leading dry-bulk owners.
Executives of Greek owner Diana Shipping told a New York finance conference sponsored by investment bank Jefferies that Western shipping banks are returning to the market and Asian lenders are entering it for the first time.
"Major Western banks are seeing the opportunity to lend at high margins of around 3% (over the London interbank offered rate, Libor), for substantial arrangement fees and lower advance ratios, and are beginning to hand out shipping loans again," said Diana president Anastassis Margaronis in an interview after his appearance.
At the same time, banks in China and South Korea - encouraged by the activity of state export-import banks in those countries - are for the first time offering direct loans to clients, Margaronis adds.
"This is a trend we have not seen before but the money is expensive: maybe 3% to 6% [over Libor]," he said. "That's a lot but if the alternative is to lose a [newbuilding] project, it can always be refinanced at a later time." As for Western banks creaking open the shutters, the management duo from Diana were not naming any names. "But I'm talking about the large banks, the names you would know," Margaronis added.
With all that said, it should be noted that Diana's team of Margaronis and chief financial officer Andreas Michalopoulos were much more positive about the lending climate than most of their public-company counterparts surveyed by TradeWinds during the course of the full-day conference.
While a few cited mild improvement, more said credit was just as scarce as it has been since the financial meltdown of roughly a year ago.
"Closed. Hopeless. Inadequate," were the words offered by Overseas Shipholding Group (OSG) chief executive Morten Arntzen when asked to assess the climate for new lending.
But told of the Diana view, he offered a partial explanation of why the Greek owner might be seeing things differently.
"Well, if there's a dry-bulk owner that could borrow right now, it's probably Diana because of the strength of their balance sheet," Arntzen said. "They don't really need the money and as I've said about our own situation, banks are more likely to lend to you when you don't need it," he added.
Having just closed, however, on a $389m loan from China Exim Bank to finance five tankers over 12 years, Arntzen is sceptical on the point of direct loans from Chinese and Korean banks.
Koreans are priced out of the market by their cost of funding, he says, while Chinese loans tend to go to Chinese customers.
"There may be some one-off deals and probably some for ships that shouldn't get built but not in any significant number," he commented.
Having nailed down OSG's financing for three VLCC newbuildings and two aframaxes delivered earlier this year, Arntzen says he believes it is possible to become a repeat customer at China Exim Bank - either for further OSG orders or for some of the "distressed opportunities" he has often discussed. "There is that possibility to step in on a situation where another owner is not able to execute [newbuildings] but first I think [China Exim Bank] wants to see us perform, to pay back the loan," he said.
OSG is negotiating a like amount of exim financing with the US Maritime Administration (MarAd), he adds.
By Joe Brady New York. Published: 23:00 GMT, 10 Sep 2009 | last updated: 11:26 GMT, 18 Sep 2009
Aries Maritime Transport Limited Announces Agreement With Grandunion Inc. Providing for Change of Control and Management
---ATHENS, Greece, Sep 16, 2009 (GlobeNewswire via COMTEX News Network) -- Aries Maritime Transport Limited (Nasdaq:RAMS) (the "Company") announced today that it has entered into a Securities Purchase Agreement with Grandunion Inc., a company controlled by Michail S. Zolotas and Nicholas G. Fistes, pursuant to which the Company has agreed to issue 18,977,778 common shares to Grandunion in exchange for three capesize drybulk carriers.
Rocket Marine Inc., a company controlled by Mons Bolin and Captain Gabriel Petridis, each a current director of the Company, has agreed to enter into a voting agreement with Grandunion in exchange for 2,666,667 common shares of Aries Maritime. Under the voting agreement, the controlling persons of Rocket Marine will agree to cause Rocket Marine to vote its common shares of the Company in accordance with instructions from Grandunion on all matters to be considered and voted upon by the Company's shareholders. Following the closing of the share issuance to Grandunion and the transfer by Grandunion of 2,666,667 common shares to Rocket Marine, Grandunion will own approximately 34.2% and Rocket Marine will own approximately 36.8% of the Company's total outstanding common shares. Through the voting agreement, Grandunion will control the vote of 71% of the Company's shares.
In connection with the transactions contemplated by the agreements:
* The Company will increase the size of its board to seven members, composed of:
-- Mr. Nicholas G. Fistes, as non-executive Chairman;
-- Mr. Michail S. Zolotas, as executive director and President;
-- Mr. Allan L. Shaw, as executive director and Chief Financial Officer;
-- Messrs. Masaaki Kohsaka, Spyros Gianniotis and Apostolos Tsitsirakis as non-executive directors; and
-- Mr. Panagiotis Skiadas, a current director, who will remain on the board as a non-executive director.
* Investment Bank of Greece has committed to purchase $145 million in aggregate principal amount of 7% senior unsecured convertible notes due 2014 (the "Convertible Notes"), convertible into common shares at a conversion price of $0.75 per share. The proceeds of the Convertible Notes are expected to be used for general corporate purposes, to fund vessel acquisitions and to partially repay existing indebtedness.
* The Company's existing syndicate of lenders has entered into a commitment letter to refinance the Company's existing fully revolving credit facility.
One of the capesize vessels, the 1992-built M/V CHINA, will be employed on a time charter with Deiulemar Shipping Societa con Unico Socio S.P.A. through April 2016 at a net daily rate of $12,588. The 1995-built M/V BRAZIL will be employed on a time charter with TMT Bulk Co., Ltd. through December 2014, with the charterer's option to extend or shorten the duration by 60 days, at a net daily rate of $28,598 for the first two years and a net daily rate of $25,830 for the remaining period, in each case plus a 50% index-based profit sharing arrangement. The third vessel, the 1993-built M/V AUSTRALIA, will be employed on a time charter with TMT Bulk Corp. for a minimum of 11 months and a maximum of 13 months at a net daily rate of $26,838.
The Securities Purchase Agreement is subject to a number of conditions, including but not limited to (1) the entry into definitive agreements for the issuance of the Convertible Notes and the closing of that transaction; (2) the entry into definitive agreements with the Company's existing syndicate of lenders for the refinancing of the Company's existing credit facility; and (3) the absence of any event reasonably likely to have a material adverse effect on the Company or the three capesize drybulk carriers.
Jeff Parry, Chief Executive Officer, commented, "We are pleased to have entered into the agreement with Grandunion. This agreement serves as an important milestone as we continue to make notable progress towards completing this strategic transaction. By expanding our fleet with the addition of three capesize vessels, Aries will enter a new asset class to take advantage of the global demand for core drybulk commodities. With all three vessels locked away on medium to long-term time charters, we expect to strengthen our fixed revenue streams and increase the Company's future earnings potential for the benefit of shareholders."
Mr. George Xiradakis, the Chairman of the Special Committee appointed by the Board of Directors to evaluate the proposed transaction, commented, "We are satisfied after consulting with our advisors that the existing shareholders will benefit from the proposed transaction, and we appreciate the dedicated efforts of our banking syndicate with regard to the restructuring of our facility. We believe the new management along with the combination of new assets, convertible notes proceeds and a restructured bank loan will allow Aries Maritime to prosper."
Investors are urged to read the Company's Form 6-K to be filed with the U.S. Securities and Exchange Commission which contains important information concerning certain conditions under which the Securities Purchase Agreement may be terminated as well as information concerning related agreements to be entered into in connection with the transactions contemplated by the Securities Purchase Agreement. The Company expects to complete the transactions contemplated by the Securities Purchase Agreement by September 30, 2009.
Seanergy Maritime Plans To Double Shares Outstanding
---SEPTEMBER 17, 2009, 12:47 P.M. ET. Seanergy Maritime Corp. (SHIP) disclosed plans Thursday to more than double shares outstanding as the dry-bulk shipper looks to raise money to increase its fleet.
The company plans to sell 30 million shares, which would more than double the shares outstanding. Shares were down 7.6% at $4.16 in recent trading and are down 23% this year.
The shipper and its units transport a variety of commodities including coal, iron ore, grain and steel products. The company acquired its initial fleet from the Restis family. The Greek shipping family is one of its major shareholders.
Dry-bulk rates have shown some signs of strengthening in recent months, though they remain far below last year's levels amid slumping demand.
The company acquired six carriers late last year from companies associated with the Restis family. Last month it acquired a controlling interest in Bulk Energy Transport (Holdings) Ltd., which owns five carriers.
Euronav Ship Management implement Electronic-TOTS
---Euronav Ship Management has been successfully using Seagull products since 2006 on all of their ships and in their offices in Greece and Antwerp. They are now upgrading to the newest release of the Seagull Training Administrator using both a comprehensive selection of computer based training modules to improve the knowledge of their seafarers and the newly launched E-TOTS as a part of the Competence Manager Program.
As a participating member of INTERTANKO, Seagull recognizes that industry-driven training initiatives like E-TOTS within a complete training program give the seafarer an opportunity for improved proficiency and a valuable career development path. This industry-driven initiative should be encouraged and strengthened.
Euronav Fleet management is conducted by three wholly owned subsidiaries Euronav Ship Management SA and Euronav SAS, both French companies with head quarters in Nantes, France and with a major branch office in Antwerp, Belgium and Euronav Ship Management (Hellas) Ltd. with branch office in Piraeus, Greece. The skills of its directly employed seagoing officers and shore-based captains and engineers give it a competitive edge in high quality design, maintenance and operation. Euronav vessels fly Belgian, Greek and French flag.
Women's International Shipping & Trading Association elects Greek shipping executive as president
---Friday, 18 September 2009. Vera Chalkidis, commercial director of Athenian Sea Carriers has been chosen to succeed Marita Scott of NorthEdge Risk Services, Bergen, who has held the presidency for four years.
Athenian Sea Carriers is a tanker management company that prides itself on its support for sustainable commerce. It was the first shipping entity to obtain ISO9001 certification for the design, development and provision of training courses for its seafarers.
Ms Chalkidis is a representative of WISTA-Hellas, and her election comes at a time when WISTA International has asked its Greek section to prepare for the next annual conference, which will be in Athens from September 29-October 1 2010.
Ms Scott said that her presidency had been an extremely rewarding time, and given her the opportunity to get to know so many competent people around the world.
In the past few years, individual WISTA membership has risen substantially, to stand at 1,200 women from 27 countries. The latest WISTA national associations to be formed have been in Hong Kong, Turkey, Switzerland and Panama, and work is continuing to expand the network further.
The WISTA international executive committee now comprises the following members, with additional oversight duties in brackets: Vera Chalkidis, president; Consuelo Rivero of Ership, secretary (also responsible for website); Kathleen Haines of Holbridge Capital Advisors, treasurer (also responsible for the Americas); Anna Risfelt Hammargren of Maritime Forum, responsible for branding, quality and as help secretary; Irene Rosberg, programme director, executive MBA in Shipping & Logistics, Copenhagen Business School, responsible for leadership, mentorship and women on the board, and rest of the world; Irene Lim of PACC Ship Managers Pte, responsible for conferences and Asia; and Dime Agboire of Iruene, Agboire & Co, responsible for Africa.
Last Updated ( Friday, 18 September 2009 )