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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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Thursday, 24 May 18
SUPRAS FIXING AROUND USD 15000 FOR INDO TO CHINA COAL TRIPS - FEARNLEYS
Capesize
Both the physical and the paper market have dropped sharply the last couple of days on the back of a lack of fresh cargoes and a growing ...
Thursday, 24 May 18
FITCH: FALLING COAL INVESTMENT TO SUPPORT ASIAN PRICES
Press Release: The long-term outlook for the Asian thermal coal prices is improving, amid rising regional demand and falling mining investment, whi ...
Thursday, 24 May 18
BEIJING ORDERS UTILITIES, MINERS TO HELP COOL RED-HOT COAL MARKET: SOURCES - REUTERS
China’s state planner ordered utilities this week to stop stockpiling thermal coal and told miners to slash prices, two sources familiar with ...
Wednesday, 23 May 18
TANKER MARKET INSIGHT - TIMOS PAPADIMITRIOU
In the last six months we have seen more than 110 reported tanker transactions involving tonnage larger than 32k dwt and younger than 18 years old. ...
Friday, 18 May 18
AFTER COAL, INDONESIAN GOVERNMENT PUSHES DMO ON GAS FOR ELECTRICITY
After introducing its domestic market obligation (DMO) policy for coal on March 12, the government is going forward with its plan to introduce a DM ...
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Showing 1716 to 1720 news of total 6871 |
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- Cement Manufacturers Association - India
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- Latin American Coal - Colombia
- Aboitiz Power Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- Intertek Mineral Services - Indonesia
- Siam City Cement PLC, Thailand
- Simpson Spence & Young - Indonesia
- Bhushan Steel Limited - India
- The Treasury - Australian Government
- Kapuas Tunggal Persada - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- San Jose City I Power Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- VISA Power Limited - India
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Toyota Tsusho Corporation, Japan
- Australian Coal Association
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Economic Council, Georgia
- Thai Mozambique Logistica
- Chettinad Cement Corporation Ltd - India
- TeaM Sual Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- Samtan Co., Ltd - South Korea
- Savvy Resources Ltd - HongKong
- Sical Logistics Limited - India
- Anglo American - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Borneo Indobara - Indonesia
- Kaltim Prima Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kobexindo Tractors - Indoneisa
- White Energy Company Limited
- New Zealand Coal & Carbon
- Deloitte Consulting - India
- India Bulls Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
- Binh Thuan Hamico - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Aditya Birla Group - India
- Maheswari Brothers Coal Limited - India
- Electricity Authority, New Zealand
- Indian Oil Corporation Limited
- The University of Queensland
- Central Java Power - Indonesia
- Larsen & Toubro Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Antam Resourcindo - Indonesia
- ICICI Bank Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Bhatia International Limited - India
- Heidelberg Cement - Germany
- Altura Mining Limited, Indonesia
- Grasim Industreis Ltd - India
- IHS Mccloskey Coal Group - USA
- Sree Jayajothi Cements Limited - India
- Orica Australia Pty. Ltd.
- Electricity Generating Authority of Thailand
- Indonesian Coal Mining Association
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Madhucon Powers Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Uttam Galva Steels Limited - India
- Jindal Steel & Power Ltd - India
- Star Paper Mills Limited - India
- Karaikal Port Pvt Ltd - India
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- PowerSource Philippines DevCo
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Africa Commodities Group - South Africa
- Sarangani Energy Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Posco Energy - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Mintek Dendrill Indonesia
- Manunggal Multi Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- OPG Power Generation Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- ASAPP Information Group - India
- Malabar Cements Ltd - India
- Videocon Industries ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Semirara Mining Corp, Philippines
- Vizag Seaport Private Limited - India
- Edison Trading Spa - Italy
- Gujarat Electricity Regulatory Commission - India
- Kepco SPC Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Goldman Sachs - Singapore
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sojitz Corporation - Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- MS Steel International - UAE
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Holcim Trading Pte Ltd - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Formosa Plastics Group - Taiwan
- Mjunction Services Limited - India
- Gujarat Sidhee Cement - India
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Siam City Cement - Thailand
- Bharathi Cement Corporation - India
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- SMC Global Power, Philippines
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- Kalimantan Lumbung Energi - Indonesia
- Jaiprakash Power Ventures ltd
- PTC India Limited - India
- Wilmar Investment Holdings
- Ambuja Cements Ltd - India
- Marubeni Corporation - India
- Globalindo Alam Lestari - Indonesia
- Planning Commission, India
- Mercuria Energy - Indonesia
- Indika Energy - Indonesia
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Tamil Nadu electricity Board
- Coalindo Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Commonwealth Bank - Australia
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Indian Energy Exchange, India
- Leighton Contractors Pty Ltd - Australia
- Minerals Council of Australia
- Parliament of New Zealand
- Petron Corporation, Philippines
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Coastal Gujarat Power Limited - India
- Eastern Energy - Thailand
- Energy Development Corp, Philippines
- Independent Power Producers Association of India
- Ministry of Transport, Egypt
- Bangladesh Power Developement Board
- Renaissance Capital - South Africa
- Romanian Commodities Exchange
- GMR Energy Limited - India
- Timah Investasi Mineral - Indoneisa
- Metalloyd Limited - United Kingdom
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Parry Sugars Refinery, India
- Eastern Coal Council - USA
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Essar Steel Hazira Ltd - India
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