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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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Sunday, 26 January 14
FREIGHT RATES FALL FURTHER ON LACK OF CARGOES - SOLYM CARRIERS
COALspot.com: The freight market has continued to soften further this week with BDI down by 12.31 pct. BDI was closed at 1,246 points week ended 24 ...
Friday, 24 January 14
US COAL PRODUCTION UP 3.9% ON WEEK IN WEEK ENDED SATURDAY - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.1 million short tons (mmst) of coal in ...
Friday, 24 January 14
DRY BULK MARKET STRUGGLING TO FIND FIRM FOOTING IN START OF 2014 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has been faltering since the start of 2014, struggling to hold its ground as low seasonal demand has hindered further growth in ...
Thursday, 23 January 14
PANAMAX : THIS WEEK THE ACTIVITY CAME DOWN DRAMATICALLY - FEARNRESEARCH
Handy
With the Chinese New Year approaching the activity and rate levels are sliding in both hemispheres. Rates in the Atlantic have knocked off so ...
Thursday, 23 January 14
30 DAYS LEFT TO REGISTER FOR PACIFIC BASIN COAL CONFERENCE
COALspot.com: (Press Release) : IHS Inc. (NYSE: IHS), the leading global source of information and analysis, will host the Pacific Basin Coal Confer ...
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- Toyota Tsusho Corporation, Japan
- Neyveli Lignite Corporation Ltd, - India
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Heidelberg Cement - Germany
- Agrawal Coal Company - India
- GN Power Mariveles Coal Plant, Philippines
- Posco Energy - South Korea
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- Xindia Steels Limited - India
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Georgia Ports Authority, United States
- Essar Steel Hazira Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- Africa Commodities Group - South Africa
- Kapuas Tunggal Persada - Indonesia
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- Sojitz Corporation - Japan
- Leighton Contractors Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- Baramulti Group, Indonesia
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Latin American Coal - Colombia
- Formosa Plastics Group - Taiwan
- Cement Manufacturers Association - India
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- Siam City Cement PLC, Thailand
- Parry Sugars Refinery, India
- Riau Bara Harum - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Energy Development Corp, Philippines
- Minerals Council of Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- Makarim & Taira - Indonesia
- Ministry of Mines - Canada
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Mintek Dendrill Indonesia
- Sarangani Energy Corporation, Philippines
- McConnell Dowell - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Coal Blending Company Limited - Australia
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Bhoruka Overseas - Indonesia
- Tamil Nadu electricity Board
- Iligan Light & Power Inc, Philippines
- Petron Corporation, Philippines
- Rio Tinto Coal - Australia
- Romanian Commodities Exchange
- Kohat Cement Company Ltd. - Pakistan
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Coal Council - USA
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Port Waratah Coal Services - Australia
- Orica Mining Services - Indonesia
- MS Steel International - UAE
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Eastern Energy - Thailand
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Aboitiz Power Corporation - Philippines
- Economic Council, Georgia
- Banpu Public Company Limited - Thailand
- Deloitte Consulting - India
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Coalindo Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- PowerSource Philippines DevCo
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Star Paper Mills Limited - India
- Bhatia International Limited - India
- Holcim Trading Pte Ltd - Singapore
- Wilmar Investment Holdings
- Gujarat Sidhee Cement - India
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- OPG Power Generation Pvt Ltd - India
- ASAPP Information Group - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Maheswari Brothers Coal Limited - India
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Indogreen Group - Indonesia
- Planning Commission, India
- Oldendorff Carriers - Singapore
- Independent Power Producers Association of India
- The University of Queensland
- GVK Power & Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- Altura Mining Limited, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- TeaM Sual Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Bukit Asam (Persero) Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vizag Seaport Private Limited - India
- IHS Mccloskey Coal Group - USA
- International Coal Ventures Pvt Ltd - India
- SMG Consultants - Indonesia
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Indo Tambangraya Megah - Indonesia
- Kumho Petrochemical, South Korea
- Goldman Sachs - Singapore
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Vedanta Resources Plc - India
- The Treasury - Australian Government
- Sical Logistics Limited - India
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- Sree Jayajothi Cements Limited - India
- PNOC Exploration Corporation - Philippines
- PTC India Limited - India
- Tata Chemicals Ltd - India
- Mercator Lines Limited - India
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- Kaltim Prima Coal - Indonesia
- Therma Luzon, Inc, Philippines
- Electricity Authority, New Zealand
- Indonesian Coal Mining Association
- Asmin Koalindo Tuhup - Indonesia
- Lanco Infratech Ltd - India
- Parliament of New Zealand
- Sakthi Sugars Limited - India
- Straits Asia Resources Limited - Singapore
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Power Finance Corporation Ltd., India
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- SMC Global Power, Philippines
- Renaissance Capital - South Africa
- Global Business Power Corporation, Philippines
- White Energy Company Limited
- Energy Link Ltd, New Zealand
- Uttam Galva Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Karaikal Port Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Manunggal Multi Energi - Indonesia
- Ambuja Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Semirara Mining Corp, Philippines
- Central Electricity Authority - India
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- Medco Energi Mining Internasional
- ICICI Bank Limited - India
- Marubeni Corporation - India
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