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Thursday, 27 February 14
SHIPPING LOANS WORTH $5 BILLION HAVE CHANGED HANDS OVER THE PAST YEAR, AS FUNDS INVEST IN SHIPPING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Funds investing in shipping has been the "talk of the town" over the past couple of years, as institutional investors, private equity and hedge funds have all emerged as newcomers to the shipping financing segment, often assuming the role of traditional shipping banks, which have exited the market, or cut their exposure. According to the latest weekly report from shipbroker Intermodal, the vast majority of those funds have been consumed in buying up shipping loans. "About $5 billion in shipping loans have changed hands in the past year and demand is driving loan prices to levels almost in line with book values", said the shipbroker.
According to an analysis by Intermodal's SnP broker George Dermatis, these funds "do not hesitate taking over entire fleets and even align themselves with several managers in an insatiable escapade to take over debts and even ships/assets on their balance sheets. Funds tolerate systemic risk much more than traditional banks that are massively exiting or reducing their exposure in the sector. So one could argue that one player is filling up the void the other creates. Therein lays the paradox" he noted.
Dermatis said that "the characteristics of traditional banks are undoubtedly much more to the liking of traditional shipowners; no exit strategy other than full debt repayment, name lending based on interpersonal relationships, which in some cases dates back decades, experience over several shipping cycles and the list goes on. The industry perceives this as an overall alignment of interests. Private Equity funds stand more or less at the other side of the road on all of these points and that creates nervousness to most being afraid of how fast these investors can climb the learning curve or lose their interest in the process".
According to the broker, "the truth is that shipping largely remains in the hands of its professionals, who live and breathe the essence of this sector and who -to a large extent- have assigned a negative connotation to the publicity that funds along with capital markets and OTC offerings gather. So, despite the fact that financing from these sources has in many times arrived when no other source of funding was available, the truth is that our industry still views them with skepticism. My personal feeling is that people spend too much time “loving or hating” a way of financing whose significance has been grossly overestimated - at least for the time being", Dermatis mentioned.
He went on to add that "despite the fact that numbers -especially last year's- are indeed impressive, it seems that equity funds do not contribute more than $6-7bn on average per year, which seems like a drop in the ocean when compared to conventional debt financing by banks which continues to provide around $250bn annually according to Marine Money. During the peak times of 2008, these figures stood close to $500bn (!!!) and this should therefore be sufficient to hush down fears that private equity alone could lead to a bubble or that it could even distort market reality... The main worry linked to overcapacity remains and the finance gap on newbuilding orders persists if not broadens. The latest available data speaks of figures of over $125bn... Whilst the presence of “new” money is duly noted, we all need to realize that the industry must be able to carry its own weight. If that means changing our processes, transparency levels, corporate responsibility standards, etc. in order to bridge this gap and attract a greater share of their attention, then maybe this is a change we should embrace", Dermatis concluded.
Meanwhile, in the dry bulk market this past week, things continued to improve on the back of rates for the smaller size segments holding on to their levels and those for Capes correcting upwards, said Intermodal, while the spill-overs of the improved sentiment have yet to affect the Panamax market. Nevertheless, the BDI ended yesterday on yet another higher note, ending the session at 1,222 points.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 10 March 14
THE FREIGHT MARKET WAS QUITE FIRM THIS PAST WEEK
COALspot.com: The freight market was quite firm this past week with BDI sharply increased by 22.65 pct week on week and closed at 1543 points, while ...
Saturday, 08 March 14
LETTERS OF INDEMNITY - SKULD
KNOWLEDGE TO ELEVATE
In today's trading market, owners are frequently requested to accept a letter of indemnity (LOI) in exchange for complying ...
Friday, 07 March 14
DRY BULK MARKET TO BENEFIT FROM CHINA'S GDP GROWTH TARGET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
With the dry bulk market freight rates finally making waves, China's aim of 7.5% GDP growth for 2014 mean once again positive news for the shipping ...
Friday, 07 March 14
RBCT, WORLD'S LARGEST COAL EXPORTING TERMINAL SHIPPED 1.78% LESS COAL MONTH ON MONTH
COALspot.com: South Africa's Richards Bay Coal Terminal (RBCT) the single largest export coal terminal in the world, shipped 4.487 million tons of ...
Friday, 07 March 14
INDONESIA SHIPPED 7% LESS COAL IN JANUARY 2014 COMPARED TO ITS DECEMBER EXPORTS
COALspot.com: Indonesia, the world 4th largest coal producer and the Global largest multi grade coal exporter shipped around $1.8* billion ...
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- Leighton Contractors Pty Ltd - Australia
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Goldman Sachs - Singapore
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Borneo Indobara - Indonesia
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- The Treasury - Australian Government
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Indonesian Coal Mining Association
- GN Power Mariveles Coal Plant, Philippines
- Independent Power Producers Association of India
- Wood Mackenzie - Singapore
- Banpu Public Company Limited - Thailand
- Indo Tambangraya Megah - Indonesia
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- CNBM International Corporation - China
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Heidelberg Cement - Germany
- Samtan Co., Ltd - South Korea
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Minerals Council of Australia
- Riau Bara Harum - Indonesia
- Planning Commission, India
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- Metalloyd Limited - United Kingdom
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Binh Thuan Hamico - Vietnam
- Chettinad Cement Corporation Ltd - India
- Vedanta Resources Plc - India
- Port Waratah Coal Services - Australia
- ICICI Bank Limited - India
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- Intertek Mineral Services - Indonesia
- Mjunction Services Limited - India
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- Jaiprakash Power Ventures ltd
- Vijayanagar Sugar Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Price Waterhouse Coopers - Russia
- SMC Global Power, Philippines
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- Renaissance Capital - South Africa
- Gujarat Sidhee Cement - India
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
- Coastal Gujarat Power Limited - India
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Salva Resources Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The University of Queensland
- International Coal Ventures Pvt Ltd - India
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Ministry of Transport, Egypt
- Australian Coal Association
- LBH Netherlands Bv - Netherlands
- Siam City Cement PLC, Thailand
- Oldendorff Carriers - Singapore
- AsiaOL BioFuels Corp., Philippines
- India Bulls Power Limited - India
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Indogreen Group - Indonesia
- IHS Mccloskey Coal Group - USA
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Kartika Selabumi Mining - Indonesia
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Standard Chartered Bank - UAE
- Marubeni Corporation - India
- Romanian Commodities Exchange
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Java Power - Indonesia
- McConnell Dowell - Australia
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Ministry of Mines - Canada
- Star Paper Mills Limited - India
- Attock Cement Pakistan Limited
- Neyveli Lignite Corporation Ltd, - India
- Medco Energi Mining Internasional
- Commonwealth Bank - Australia
- SMG Consultants - Indonesia
- Meralco Power Generation, Philippines
- Orica Australia Pty. Ltd.
- Deloitte Consulting - India
- Karbindo Abesyapradhi - Indoneisa
- Posco Energy - South Korea
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Singapore Mercantile Exchange
- South Luzon Thermal Energy Corporation
- Kobexindo Tractors - Indoneisa
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Dalmia Cement Bharat India
- Electricity Generating Authority of Thailand
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Sojitz Corporation - Japan
- Bukit Asam (Persero) Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- PNOC Exploration Corporation - Philippines
- Coalindo Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Vizag Seaport Private Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sical Logistics Limited - India
- Australian Commodity Traders Exchange
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Mercator Lines Limited - India
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Semirara Mining Corp, Philippines
- Madhucon Powers Ltd - India
- London Commodity Brokers - England
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parliament of New Zealand
- Kumho Petrochemical, South Korea
- Tata Chemicals Ltd - India
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- Gujarat Electricity Regulatory Commission - India
- Bhushan Steel Limited - India
- Thai Mozambique Logistica
- PTC India Limited - India
- Karaikal Port Pvt Ltd - India
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- Xindia Steels Limited - India
- Indian Energy Exchange, India
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- CIMB Investment Bank - Malaysia
- Trasteel International SA, Italy
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Siam City Cement - Thailand
- Bhoruka Overseas - Indonesia
- Bhatia International Limited - India
- Bayan Resources Tbk. - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Central Electricity Authority - India
- OPG Power Generation Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Chamber of Mines of South Africa
- Mercuria Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- MS Steel International - UAE
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