Greek Shipping News Cuts
Week 32 - 2010
Public players accelerate the S&P drive
A total of 113 vessel acquisitions have been announced since 1 January: 58 bulkers, 51 tankers and four container ships.
The more recent dry bulk deals feature fewer Capesizes and VLOCs than in 1Q10, with a growing emphasis on smaller Supramaxes, Kamsarmaxes and Handymaxes. In contrast, demand on the tanker side for the largest vessels (VLCCs) has not abated.
Public purchases earlier in the year were more heavily weighted towards newbuilding orders. In recent months several en bloc transactions have swung the pendulum towards second-hand tonnage, although newbuilding deals continue.
US public firms committed $2.98Bn for tankers during July (average of $59M/vessel across all asset classes), $2.52Bn on bulkers ($43M on average/vessel) and $157M on box ships ($39M average/vessel). Although New York listings prevail in the dry bulk and tanker arenas, the centre of gravity for public container lines is Asia, where the very same asset-purchasing pattern is apparent. In the past five weeks, Singapore-listed NOL and Taiwan-listed Evergreen have announced 20 box-ship newbuilding orders at an aggregate price of $2Bn.
NY-listed owner acquisitions
Purchase period: 1 January-31 July 2010
US-listed companies announcing acquisitions: 21
Ships acquired: 113 (58 bulkers, 51 tankers, 4 box ships)
Total spent: $5.66Bn ($2.98M tankers, $2.52Bn bulkers, $157M box ships)
Source: Fairplay - Trade 12 Aug 2010
Slowdown signs - Second hand vessel sales retreat to year lows during July
---Monday, 16 Aug 2010
With sea freight markets retreating both in the dry and the wet segments of the market during most of July, ship owners were reluctant to invest in acquiring more vessels, after the high level of sale and purchase activity, observed during May and June.
According to the latest monthly analysis, prepared by shipbroker Golden Destiny, in cooperation with Hellenic Shipping News Worldwide, July could be described as the month with the lowest record activity during the year, in terms of reported number of transactions, with tankers holding the largest share of the S&P secondhand market, almost 32%. A total of 72 vessels were traded last month for a total of around USD 2 billion, which translates to a negative change of 30% versus the previous month.
Golden Destiny said that the low seasonal summer period has slowed down the purchase plans of Greek and foreign buyers especially in the bulk carrier sector, which used to be the key factor in the strength of the S&P secondhand market. The dramatic and rapid collapse in the BDI has calmed down the S&P activity of Greek and foreign buyers who seem to adopt the wait and see approach before investing again in the sector as asset values are still on the high side and expectations for a strong Chinese demand remain weak for the rest of the summer. The month ended with a negative monthly change of around 70% in the volume of reported bulk carrier S&P transactions as only 18 vessels reported to have changed hands equaling to a total amount of money invested around USD 430,750,000 with Greeks to have invested around USD 39,600,000.
The plunge of the BDI and the dry bulk market as a whole, led to the rising of the wet sector, which for the first time this year, managed to surpass the bulk carrier market, in terms of the number of vessels reportedly traded in the second hand market.
Golden Destiny said that "The summer time has also influenced the freight market of tankers with crude carriers experiencing the biggest falls in key trade routes. However, the buying momentum of Greek and foreign buyers has recorded around 35% MoM increase, 23 vessels reported to have changed hands equaling to a total amount of money invested around USD 949,100,000, as tanker asset values seem to be still attractive investment opportunities. In the container sector, the S&P activity continues with positive buying momentum as the charter market remains at strong levels and idle fleet falling below 2% of the existing fleet while at the beginning of the year was standing at 10.4%. Asset values are at such attractive levels, estimated to be barely more than half below its peak levels seen in 2008, with some Greek owners entering into the sector for the first time either with the purchase of secondhand vessels or order of new units."
According to Golden Destiny, the total number of vessels reported sold to Greeks estimated to be 15 equaling to a total amount of money invested region USD 552,600,000, indicating a negative monthly change of around 55%. The preference of Greek owners is towards the container sector as around 53% of Greek purchases were reported in the container sector, 8 containers reported sold equaling to a total amount of money invested around USD 274,000,000. Greeks are still holding the largest share of the secondhand market in terms of reported number of transactions versus Chinese buyers but their buying momentum has weakened due to the postponement of purchase plans in the bulk carrier sector. Greeks estimated to hold around 21% of the secondhand market in terms of reported number of transactions while Chinese around 8.3%. The buying activity of Chinese buyers has strengthened since the previous month with purchase interest in the bulk carrier and container sector. In July 2009, Greeks were holding just almost 14% of the secondhand market with 63% of their purchases reported in the bulk carrier sector, 19 vessels reported to have sold equaling to a total amount of money invested around USD 831,950,000.
Download File. (Sourced from Hellenic Shipping News)
Back in shape after bumpy ride
---The managing duo of a Greek shipowner have had their hands full with corporate restructuring and a fleet overhaul.
Piraeus-based Newlead Holdings was on the brink of being delisted from the Nasdaq exchange in New York last month but it says it is now back on top form.
The shipowning company, which has a mixed fleet of bulkers and products tankers, was trading at around $8 per share in the first few days of August for the first time in almost two years.
Executive chairman Nicholas Fistes and chief executive Michael Zolotas are known in Piraeus for their commercial savvy and the company has proved it can handle some serious challenges. The duo have just emerged from an eight-month merger-and-acquisition (M&A) process, having taken over troubled Aries Maritime Transport in October 2009, undertaken a major fleet overhaul and completed a reverse stock split. The company changed its name to Newlead in December.
In the short term, Zolotas says Newlead aims to raise the liquidity of its share and use the $145m bond facility (see page 20) on its books for further expansion.
The company plans to buy another five to 12 ships, most likely tankers. Zolotas says the wet sector is now emerging from a down cycle and will likely see a spike over the next three to six months.
More importantly, Newlead is also positioned to take advantage of a wave of dry-bulk distress sales that Zolotas expects over the next 18 months.
He and Fistes have certainly had their hands full.
Just three months ago, Newlead shares were valued at under $1m, with almost zero trading activity. The company consequently contravened Nasdaq regulations and also fuelled market speculation of imminent closure.
Zolotas says the rejig marked the end of a bumpy restructuring after private entity GrandUnion, a 50/50 venture between Fistes and Zolotas, took over Aries and its fleet of 11 products tankers and containerships in 2009.
Aries was plagued with problems in the wake of the financial meltdown in late 2008.
The company has sold all but five products tankers for a total of $43.2m in cash. This has been allocated for debt repayment. One of the remaining products tankers, the 41,400-dwt High Land (built 1992), is set for disposal by the end of the year.
Newlead has also bought seven bulkers, two products tankers and two newbuildings belonging to GrandUnion and subsidiary Newlead Shipmanagement. These deals were worth $327m in total and were paid for through a combination of shares to GrandUnion and financing, Zolotas says.
The fleet has also been boosted by three bulker-newbuilding contracts bought on the open market for a total of $149m. They comprise two 80,000-dwt vessels at Cosco Dalian in China for delivery in 2010 and 2011 and one 92,000-dwt ship at an undisclosed South Korean yard set to arrive in 2011.
Another three capesizes that were part of the Aries takeover round off the fleet.
Even though the new additions brought in valuable cash flow to service debt, Newlead continued to announce losses earlier this year.
The effects of the fleet revamp will also be measured at the end of this week when Newlead announces its latest results.
Zolotas says meeting debts and restructuring the fleet has been no easy task. Hard decisions were made to prioritise payments to crews, banks and insurance providers. Outstanding debts to services companies were also eventually covered, he adds.
But the question remains as to whether Newlead can compete against other better-performing listed players. Unlike some of its rivals, Wall Street pundits say the company has yet to secure analyst coverage that will bring more attention to the stock.
The analyst says only around 20% of Newlead is currently publicly owned. GrandUnion holds over 28%, Focus Maritime, a company owned by Zolotas, just over 30% and 19% is owned by the previous management team of Aries. The voting rights of this stake are held by GrandUnion.
Newlead also has to increase its market capitalisation to over $200m from the current level of $50m, Argyropoulos argues, as well as increase trading volumes and bring in institutional investors.
He expects the company will embark on a roadshow sometime soon with a view to an equity offering.
By Yiota Gousas Athens
Published: 21:59 GMT, 12 Aug 10 | updated: 19:34 GMT, 11 Aug 10
Economou to take 10% stake in Danaos
* Monday 09 August 2010 * by Nigel Lowry. Data provided by Lloyd's List Intelligence
Move part of equity-boosting process that will see Danaos boss John Coustas and family plough another $100m into boxship company
At an issue price of $3.70 per share, which represents a discount of about 6% to the average share price over the last two months, Mr Economou is calculated to be paying about $43m for his holding in the Piraeus-based owner, which is projected to have a fleet of more than 60 container vessels by 2012.
As well as the fresh equity, Danaos also unveiled banks an additional $426m in new debt financing agreed by its existing banks in order to finance the orders.
The company also said the agreements provide for modifications to its existing $3bn in bank debt facilities, including major extensions to amortisation schedules and maturities, as well as a reduction in interest rate margins.
Financial covenants, events of default, and guarantee and security packages will also be revised, the company said.
But the financial re-engineering also includes another two important elements from other quarters.
Negotiations with some of the shipbuilding yards are said to have yielded about $190m in vendor financing allowing Danaos to pay for some of the newbuildings in instalments, rather than on delivery.
In addition, Danaos has agreed a $203m credit package from China Exim Bank, which is secured by Sinosure.
Mr Coustas will see his shareholding in the company drop from about 80% to just over 70% as a result of the tranche of the capital injection coming from other investors.
Mr Economou was not immediately available for comment but heralded an interest in the container vessel sector earlier this year when a connected entity emerged as the buyer of the Hanjin-built CMA CGM Kessel, which was sold as a newbuilding by the Korean yard for a rock-bottom $41m.
He has since been reported as eyeing secondhand purchases and even newbuildings, but with no more business clinched so far.
Capital Product Partners L.P. Announces Pricing of 5,500,000 Common Units
---ATHENS, GREECE, Aug 10, 2010 (MARKETWIRE via COMTEX News Network) -- Capital Product Partners L.P. (the Partnership) (NASDAQ: CPLP) announced today that it has priced its public offering of 5,500,000 common units representing limited partnership interests at a public offering price of $8.63 per common unit. The Partnership has granted the underwriters a 30-day option to purchase an additional 825,000 common units to cover over-allotments, if any. The Partnership expects to use the net proceeds from the public offering to acquire the M/T Assos (renamed M/T Insurgentes), a medium range product tanker vessel, from its sponsor Capital Maritime & Trading Corp. (Capital Maritime) for $43.5 million and for general partnership purposes. The offering is expected to close on August 13, 2010.
The Partnership's common units trade on the Nasdaq Global Market under the symbol "CPLP."
The joint book-running managers for this offering are UBS Investment Bank and Citi. The lead managers are Deutsche Bank Securities and Wells Fargo Securities, and the co-managers are Oppenheimer & Co. and Stifel Nicolaus Weisel.
When available, copies of the prospectus supplement and accompanying prospectus related to this offering may be obtained from UBS Investment Bank, Attention: Prospectus Department, 299 Park Avenue, New York, NY 10171, or by calling UBS toll-free at: 888-827-7275 or from Citi, Brooklyn Army Terminal, 140 58th Street, 8th Floor, Brooklyn, NY 11220, or by calling Citi toll-free at: 800-831-9146 or by e-mailing Citi at: email@example.com.
This news release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This offering may be made only by means of a prospectus supplement and accompanying prospectus.
About Capital Product Partners L.P.
Capital Product Partners L.P. (NASDAQ: CPLP), a Marshall Islands master limited partnership, is an international owner of modern double-hull tankers. Capital Product Partners L.P. owns 20 modern vessels, comprising 17 MR tankers, two small product tankers and one Suezmax crude oil tanker. Our vessels are under medium- to long-term charters to BP Shipping Limited, Morgan Stanley Capital Group Inc., Overseas Shipholding Group and Capital Maritime & Trading Corp.