Greek Shipping News Cuts
Week 02 - 2010
--- With s&p opportunities beginning to appear, Greek-controlled listed shipping companies are turning to investors to raise funds to underwrite purchases, indicating a buying-spree is on the horizon.
OceanFreight has reaped $83.9m in net proceeds from a share sale, while the Angeliki Frangou-led Navios Maritime Holdings could embark on a buying spree after raising $88m from the sale of two bulkers to an affiliate. Seanergy Maritime Holdings says it plans to raise just over $27m from a share sale to underwrite the $89.5m purchase of a 2009-built capesize bulker.
NYSE-listed Seanergy says, in a filing to the US Securities and Exchange Commission (SEC), it penned a provisional deal in December for the capesize bulker which has a term charter of between 59 to 62 months in place. With leading shareholder Victor Restis committed to buying $5m of the $25m shares on sale and a further $3.75m worth on offer to underwriters Maxim Group and Rodman & Renshaw, Seanergy's filing says the sale should bring in $27.13m after costs. Conclusion of the purchase is dependant on the successful completion of the offer.
The charter, which started last October, is worth $53,500 a day, says Seanergy, presently owner of four capesizes, five panamaxes and two handymaxes.
Seanergy said: "We intend to acquire additional dry bulk carriers or enter into new contracts through timely and selective acquisitions of vessels." The company said it funded the current acquisition primarily from the proceeds of the offering and "any future acquisitions using amounts borrowed under our credit facility, future borrowings under other agreements as well as with proceeds from the exercise of the Warrants or through other sources of debt and equity".
Nasdaq-listed bulker and tanker owner OceanFreight revealed its cash grab when it filed a shelf registration that will keep fund-raising ammunition for up to $400m in potential equity offerings. OceanFreight says it sold Yorkville's YA Global Master nearly 73.3m shares January 11 as part of its standby equity distribution agreement. The agreement was made last summer to allow the owner to sell up to $450m worth of shares to the New Jersey private equity firm.
Second quarter this year OceanFreight, owner of nine bulkers and four tankers, takes delivery of the 180,000dwt Montecristo (ex-Mineral Monaco), built 2005, purchased from Belgium's CMB for $49.5m in September.
In its latest shelf registration, the Anthony Kandylidis-led owner "may periodically offer" up to $400m in new common shares, debt securities, warrants or other securities. The company says it may use the proceeds of any offerings to purchase vessels, to enhance liquidity or to "assist us in complying with our loan covenants", among other potential uses of the cash.
Meantime, OceanFreight confirms sale of the 72,100dwt Pierre, built 1996 for $22.6m, reported by Newsfront Vol 10, Nr 48, though the price was then said to be $22m. OceanFreight also reports its 96,000dwt tanker Tigani, built 1991, has joined the Heidmar-managed aframax spot pool, Sigma Tankers, following the conclusion of a t/c at a gross of $29,800 daily.
George Economou, who sold OceanFreight the Tigani, is chairman and 49% owner of Heidmar, and OceanFreight ceo Kandylidis, who is Economou's nephew, is a member of the pool manager's board.
Navios Maritime Holdings has sold the 2004-built, 75,700dwt Navios Hyperion to Navios Maritime Partners for $63m and is exercising a purchase option over the 75,800dwt Navios Sagittarius, built 2006 at $25m.
Navios Holdings said it will use the proceeds from the Navios Hyperion sale "for operating purposes, such as repayment of indebtedness or reinvestment in vessels". Navios Partners said the Navios Sagittarius has a charter-free market value of around $38m and purchasing it will improve cash flow by $1.9m due to reduced charter hire.
General Maritime (Genmar) sees a 12-month window of opportunity to expand its tanker fleet before the market recovers, according to a leading US analyst.
Peter Georgiopoulos-led Genmar may also look to tap shareholders to raise the necessary funds, says Oppenheimer analyst Scott Burk in a note to clients, after meeting with the tanker owner's management. Burk said Genmar is likely to purchase ships in the next year or so, given historically low vessel prices and an expected upturn in rates by 2011 and could tap unencumbered ships or the equity market for acquisition capital.
Burk says Genmar predicts the tanker market will begin to see signs of recovery this year, with scrapping of around 12% of the tanker fleet helping to spur rates at the end of 2010 or the start of 2011.
-- Filed: 2010-01-12
Both sides of coin visible in Greek market
--- Greek owners who placed newbuilding orders in the high market without having financing in place may soon be faced with the moment of truth but those that are not overextended may find opportunities in the comparatively low current prices.
In its annual round-up of the Greek newbuilding scene, Piraeus-based brokerage George Moundreas & Co suggests that at least 12% to 15% of the orders existing in September 2008 have evaporated, while delivery postponements have reached some 30%.
The broker notes that a considerable percentage of existing orders are lacking financing and says that, having paid the first installment on ships, some owners have been hoping that "something may happen" before the second insallment falls due.
However, newbuilding consultant George Banos, who prepares the Moundreas report, says he fears "a new wave of cancellations", this time in an unpleasant atmosphere.
Nevertheless, the broker says that in the past two to three months it has "gradually" been approached by a number of clients encouraged by the comparatively low current price levels.
"There is no doubt that a number of new orders will come to light soon," Moundreas said.
The broker admits that it is offering figures with some hesitation because new orders, cancellations, delivery extensions or other changes to original contracts are very difficult to trace and evaluate. However, it says it believes the outstanding orders for Greek owners at the close of 2009 stood at a total of 624 ships including 360 bulkers of 35 million dwt and 240 tankers of 20 million dwt. This was substantially down on the orders carried over at the end of 2008, which were reported at 836 vessels including 463 bulkers of 46.2 million dwt and 300 tankers of 26.3 million dwt.
By Gillian Whittaker Athens
Published: 00:00 GMT, 15 Jan 2010 | last updated: 14:53 GMT, 14 Jan 2010
Greek owners using bold tactics to keep prices low
--- Michelle Wiese Bockmann - Friday 15 January 2010
INCREASING numbers of Greek shipowners have used aggressive, new tactics to successfully force cash-starved Asian shipyards to keep lowering newbuilding contract prices, as plummeting values make it economical to cancel an older contract outright at one yard and re-order at another.
With newbuilding prices plunging by an average 40% from record highs of 18 months ago, owners have not only re-negotiated or substituted existing contracts, but have found it cheaper to cancel an older contract and forfeit the first instalment payment of 20%, then re-order elsewhere.
But the yard switch strategy was difficult to replicate on a widespread basis, said commercial director, John Dragnis, and was unlikely to emerge on a major scale.
But George Moundreas, which released its first newbuilding report in nearly 18 months last week, highlighted how some cash-rich owners had confidentially negotiated ships at levels last seen in 2004, aware a further cancellation crisis could be two months away.
An unknown number of Greek buyers had missed second instalment payments, but not disclosed their financial troubles for fear of losing their initial 20% deposit, the shipbroker said
The shipping markets collapse in September 2008 combined with a bank lending freeze created a newbuilding order drought for the shipbuilding industry, leading to a cash-flow crisis for many yards, especially in China and South Korea.
Piraeus plans a new shipping forum
European Companies Research Maritime Carbon Capture
--- A new collaborative research and development (R&D) project aims to develop blueprint designs for on-ship carbon capture and storage (CCS) technology to reduce maritime greenhouse gas emissions
Det Norske Veritas AS, a leading maritime classification society has joined with the consultant group Process Systems Enterprise Ltd (PSE) to explore the idead.
A recent International Maritime Organisation (IMO) study estimates maritime carbon dioxide (CO2) emissions at over 1000m tons per year, about 3% of total CO2 emissions produced by human activities (anthropogenic). With these expected to increase threefold by 2050 the IMO is likely to introduce regulations to reduce emissions.
The Maritime CCS project aims to develop a blueprint design for an on-board process for chemical capture and temporary storage of CO2 for ships in transit until discharge into transmission and storage infrastructures at the next suitable port.
Project leader PSE is involved in model-based innovation (MBI), which applies high-fidelity mathematical models to accelerate innovation, manage development risk and optimise process design and operation. Its gPROMS modelling technology is used in the oil & gas, chemicals, power generation, clean energy and other process sectors.