Accessing US Capital Markets – Debt and Equity Offerings

by Robert Schreiner

Capital requirements for newbuildings are growing at such a pace that the principal owner, chief executive or chief financial officer of today’s shipping company should now be looking to a variety of financing alternatives in addition to traditional bank finance.

US markets have tremendous appetite; and the non-US shipping company pursuing a long-term strategy which includes raising large amounts of capital and building a strong US-investor base should put itself in the position of being able to access US capital markets from time to time.

Typically, a company approaches the capital markets with a debt issue. Depending on the success of the offering, the company may go back to the debt market within nine to 12 months, but more frequently it returns within 18-24 months. The company’s underwriters, who often have the right of first refusal, will go back to their clients and suggest if and when the time is right for another issue.

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