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Friday, 06 July 18
HOW FLEET SIZE, CORPORATE PROFILE AND STRATEGY ARE DECIDING FACTORS IN SELECTING AN APPROPRIATE FINANCING STRATEGY - PWC
 KNOWLEDGE TO ELEVATE
The challenges that shipping companies are facing when selecting an appropriate financing strategy during the current period of volatile global markets, renewed fears of protectionism and trade wars and the possibility of new technologies disrupting traditional industries, such as shipping, were some of the issues discussed with shipowners and shipping finance experts during the Shipping Industry Briefing organised recently by PwC at the Yacht Club of Greece, entitled ‘Navigating through new challenges in the global markets’.
While interest in accessing the US capital markets remains high for a number of private shipping companies, the ability to do so is becoming increasingly difficult for companies with smaller sized fleets. “During 2018, the US capital markets started out strong and have maintained momentum despite the volatility in the market. IPO themes continue to be strong – top line growth, differentiation, dependable cash flow and predictable revenue. More specifically, shipping companies that are interested in accessing the US markets will need to focus on segment, volume and differentiation”, says Santos Equitz, Director responsible for Capital Markets at PwC Greece.
To be on US capital markets radar requires the combination of a large market capitalisation and a strong prospect of recovery in the shipping markets, which may be a difficult combination to meet for private shipping companies. The limited access to the US markets and the decline in traditional bank lending, has led to alternative sources of finance to emerge to fill the gap. Leasing finance and Nordic Bonds have proven to be viable alternatives to fill the debt gap left from the traditional shipping banks reducing their exposure to the sector. Additionally, when it comes to raising equity, the Norwegian market has been effective, utilising the unregulated over-the-counter market (N-OTC) and Merkur Market for smaller companies or the regulated stock exchanges Oslo Axess and Oslo Stock Exchange for larger companies.
Socrates Leptos-Bourgi, Global Shipping & Ports Leader at PwC, opened the floor to a panel of experts to discuss these alternative sources of finance, mentioning that to go public in the US capital markets is a significant transformation for any company and more so for smaller, family owned companies. As discussed on the panel, some alternatives are available in the Norwegian markets, which have recently provided companies with the ability to raise finance through either equity issuance or high yield bonds. Andreas Aamodt Kilde, Partner at Pareto Securities, explained: “With the traditional shipping banks continuing to reduce their exposure to the global shipping industry, shipowners have to explore other alternatives to finance their vessels. Fortunately, the options are many and the opportunity in today’s market lies in taking advantage of the attractive non-bank financing solutions available. With every fleet, employment profile and capital structure being unique, my best advice to shipowners is to explore the alternatives out there in a structured and competitive process – financing is available, but one needs to know where to look”.
Although some interest had been shown by private equity funds in the past, this is not a trend that seems to continue and investors are looking for ways to exit. Nevertheless, this activity has positively influenced the interest in M&As, said Anthony Argyropoulos, Managing Director at Seaborne Capital. Although the scope for further M&As does not seem to be prevalent due to the lack of synergies in shipping, Argyropoulos believes we should expect a few more, possibly with public-private partnerships as the driving force behind them.
Chinese lease finance is also growing. With 12 out of 25 largest and active financing institutions coming from China, there’s a large appetite for investment, however the size and reputation of shipping companies are still major contributors to the final decision, explained Nick Daskalakis on the panel, Director at Smarine Advisors Limited. “Leasing finance has matured, providing flexibility on ship age, type, origin of built, employment, tenor, pre-delivery, day to day operational requirements, competitive terms and fast execution and drawdown timeframes. It is ideal for capital intensive projects, boosts liquidity and strategically diversifies lending risk for shipping groups, offering synergy opportunities with Chinese yards and charterers. Large holding structure groups with excellent reputation, transparency and strong cashflow are the prime candidates albeit competition is cascading interest towards mid-size groups nowadays”, he continues.
The role of China in global trade and the shipping industry was further analysed by Mr Feng Li, Commercial Counsellor of the Chinese Embassy in Greece. The Commercial Counsellor explained how China’s economic growth and shipping are linked and the wellbeing of the shipping sector is dependent on ensuring an open market and competitive free trade. He also added that the Cosco developments at Piraeus port are a commitment to develop the largest container port in Europe for the establishment of new channels to global trade. China and Greece have complementary strengths when it comes to shipbuilding, and the relationship between the two has been growing stronger over the past decade.
When it comes to the overall prospects of the main shipping markets, Henriette Brent-Petersen, Managing Director of Shipping and Offshore Research at DVB Bank SE, commented that “Despite the continuing ‘deleveraging’ process both in the Chinese and Korean shipbuilding industry, we do not expect the significant idle yard capacity to completely disappear in the short term”. “The data show a decrease in the nominal yard capacity, but do they reflect the truth? We are living in a world with new disruptive technologies that change the way we used to do business, and the same applies for the traditional shipbuilding industry. By leveraging on innovative automation technologies such as the use of robots, sensor systems and artificial intelligence, shipbuilders will be able to achieve a higher productivity and low-cost construction, high-quality products and on-time delivery. As a consequence, the conventional ship construction process could be transformed into what we call a ‘smart yard system”, she explains. The overall impact on shipping will likely be shorter cycles and hire rates to be volatile within a much narrower range.
Digitisation in the shipping sector is one of the most disruptive developments since the industrial revolution, and should not be ignored by any stakeholder – not just ship owners, but also ports and logistics service providers- which will ultimately lead to optimized operations in the whole maritime logistics chain. Referring to digital strategies in the industry, Burkhard D. Sommer, Deputy Head of the Maritime Competence Centre of PwC Germany, comments: “Digitisation is unavoidable; it will cause disruptive changes to the current business models. Digital strategies and implementation of technologies and processes shall be based on a holistic approach to improve the current way of working as well as ensure the success of any company in the future. Digitisation is importantly about using data from various sources to optimise operations. “It is not an option – in a quick changing world it is a necessity to be successful in the future but most of the players in the maritime industry still have a long way to go. It is time to move”, he said.
Shipping has been increasingly operating in a challenging economic environment, posing challenges as well as opportunities to operate and innovate for sustainable business operations. Although tradition has been a driving force in the industry’s success in the past, this is the time for ship owners to move away from traditional operating models and start thinking of alternative ways to grow their businesses.
Source: PwC
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Friday, 29 June 18
THE LBH GROUP AND RHENUS PLAN TO ESTABLISH A JOINT COMPANY
Press Release: The port services provider, the LBH Group, and the logistics specialist Rhenus, are planning to cooperate closely in the European in ...
Friday, 29 June 18
SUPRAMAX: INDO / CHINA COAL ROUNDS PAYING AROUND USD HIGH 11000 - FEARNLYS
Capesize
Its been an interesting week with a strong demand for ships out of Brazil, making C3 rates remain around USD 19 pmt said Fearnlys in i ...
Friday, 29 June 18
JAPAN'S TOHOKU ELEC, GLENCORE ABANDON APRIL-MARCH COAL CONTRACT TALKS - REUTERS
Japan’s Tohoku Electric Power Co Inc and Glencore Plc have abandoned talks on annual thermal coal supplies after failing to reach an agreemen ...
Wednesday, 27 June 18
SHIPPING MARKET INSIGHT - APOSTOLOS ROMPOPOULOS
After the abolishment of the trade embargo against Iran, there was a lot of optimism from the country’s side, as after quite some time a numb ...
Tuesday, 26 June 18
"ALWAYS ACCESSIBLE": ARRIVAL, DEPARTURE OR BOTH? - INCE & CO
KNOWLEDGE TO ELEVATE
An “always accessible” berth warranty is often used by an owner to transfer the risk of delays in berthing to ...
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Showing 1686 to 1690 news of total 6871 |
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- Xindia Steels Limited - India
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Australian Commodity Traders Exchange
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- Eastern Energy - Thailand
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Lanco Infratech Ltd - India
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Commonwealth Bank - Australia
- Petron Corporation, Philippines
- Mintek Dendrill Indonesia
- Metalloyd Limited - United Kingdom
- SN Aboitiz Power Inc, Philippines
- Bhushan Steel Limited - India
- Electricity Authority, New Zealand
- Sinarmas Energy and Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- The University of Queensland
- Edison Trading Spa - Italy
- Goldman Sachs - Singapore
- Alfred C Toepfer International GmbH - Germany
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Finance - Indonesia
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Therma Luzon, Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Maheswari Brothers Coal Limited - India
- MS Steel International - UAE
- Parliament of New Zealand
- Vedanta Resources Plc - India
- Barasentosa Lestari - Indonesia
- Planning Commission, India
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Power Finance Corporation Ltd., India
- Georgia Ports Authority, United States
- Anglo American - United Kingdom
- Thiess Contractors Indonesia
- Semirara Mining and Power Corporation, Philippines
- Parry Sugars Refinery, India
- Kumho Petrochemical, South Korea
- Indonesian Coal Mining Association
- New Zealand Coal & Carbon
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- Thai Mozambique Logistica
- Jorong Barutama Greston.PT - Indonesia
- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- White Energy Company Limited
- Carbofer General Trading SA - India
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- OPG Power Generation Pvt Ltd - India
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Link Ltd, New Zealand
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- GMR Energy Limited - India
- London Commodity Brokers - England
- Kalimantan Lumbung Energi - Indonesia
- Ambuja Cements Ltd - India
- McConnell Dowell - Australia
- SMG Consultants - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Orica Australia Pty. Ltd.
- Singapore Mercantile Exchange
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Trasteel International SA, Italy
- Kapuas Tunggal Persada - Indonesia
- CNBM International Corporation - China
- Malabar Cements Ltd - India
- Indogreen Group - Indonesia
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- Orica Mining Services - Indonesia
- Australian Coal Association
- Posco Energy - South Korea
- Attock Cement Pakistan Limited
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Karaikal Port Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Jaiprakash Power Ventures ltd
- Directorate General of MIneral and Coal - Indonesia
- Salva Resources Pvt Ltd - India
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- The State Trading Corporation of India Ltd
- Aboitiz Power Corporation - Philippines
- Semirara Mining Corp, Philippines
- Intertek Mineral Services - Indonesia
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- Energy Development Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Samtan Co., Ltd - South Korea
- Indika Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Makarim & Taira - Indonesia
- Aditya Birla Group - India
- Globalindo Alam Lestari - Indonesia
- Mercuria Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Tata Chemicals Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Mercator Lines Limited - India
- Toyota Tsusho Corporation, Japan
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Ministry of Mines - Canada
- ASAPP Information Group - India
- VISA Power Limited - India
- Leighton Contractors Pty Ltd - Australia
- Heidelberg Cement - Germany
- PNOC Exploration Corporation - Philippines
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- Pipit Mutiara Jaya. PT, Indonesia
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Savvy Resources Ltd - HongKong
- PetroVietnam Power Coal Import and Supply Company
- Riau Bara Harum - Indonesia
- Electricity Generating Authority of Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate Of Revenue Intelligence - India
- South Luzon Thermal Energy Corporation
- Bank of Tokyo Mitsubishi UFJ Ltd
- Grasim Industreis Ltd - India
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- IHS Mccloskey Coal Group - USA
- Kideco Jaya Agung - Indonesia
- Sical Logistics Limited - India
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Ministry of Transport, Egypt
- Sakthi Sugars Limited - India
- Bulk Trading Sa - Switzerland
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Interocean Group of Companies - India
- Essar Steel Hazira Ltd - India
- CIMB Investment Bank - Malaysia
- Bayan Resources Tbk. - Indonesia
- Global Business Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Ind-Barath Power Infra Limited - India
- Kepco SPC Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Wilmar Investment Holdings
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Marubeni Corporation - India
- Coalindo Energy - Indonesia
- Altura Mining Limited, Indonesia
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Deloitte Consulting - India
- Kaltim Prima Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Bhoruka Overseas - Indonesia
- Madhucon Powers Ltd - India
- Chamber of Mines of South Africa
- Simpson Spence & Young - Indonesia
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- Economic Council, Georgia
- Gujarat Sidhee Cement - India
- Formosa Plastics Group - Taiwan
- European Bulk Services B.V. - Netherlands
- Siam City Cement - Thailand
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