TAS Offshore Finds IPO Success

Riding on improved sentiments in the global equity markets, we have witnessed a number of public equity placements, mainly in the form of new shares placements or rights issues. Companies are seizing the window of opportunity to re-capitalise and strengthen their balance sheets in order to better prepare themselves for the uncertainties ahead. Malaysian export-oriented shipbuilder TAS Offshore has successfully sold 77 million new shares, or 42.8% of the enlarged capital and paid up share capital, at RM 0.90 a piece and raised RM 69.3 million (USD 19.8 million) on the Bursa Malaysia Stock Exchange.

This makes TAS Offshore the third shipping company to have found success in the IPO markets since the beginning of this year after Singapore’s Yujin International and Taiwan’s China Shipbuilding Corporation. Gone are the good old days when investors had a large appetite for shipbuilders, but the successful listing of TAS Offshore despite its small size, demonstrates that there are still pockets of liquidity waiting to be tapped. The public retail tranche of 9 million for the Malaysian public was oversubscribed by 19.47 times. Kudos goes to OSK investment Bank for bringing the Sarawak based shipbuilder to the stock market in a maiden debut at 5% premium to its offer price. OSK Investment Bank has also played an important role in underwriting 52 million new shares under the public issue to facilitate the success of this offering. Continue Reading

Covenants Waived

Last week, First Ship Lease Trust (“FSL Trust”) announced that they had come to terms with their bankers with respect to existing credit facilities. The amendment incorporates the following main terms.

During the loan to value covenant waiver period which extends until the end of 2Q 2011:

-          The minimum coverage ratio of the charter-free fair market value of FSL Trust’s vessel portfolio over its outstanding indebtness will be reduced from 145% to 100%. Continue Reading

Meriel Arranges For TMT

Meriel Partners have successfully arranged a USD 20 million senior loan facility for TMT with Dongbu Insurance Co. Ltd. The proceeds will be used to finance a 96 built capesize bulk carrier. Established in December 2008, Meriel Partners is an independent financial adviser and assist maritime shipping clients with their various financing needs. Meriel Partners’ services include debt and equity capital raising, structured finance, securitization, restructuring and M&A. Continue Reading

Export Finance Money Looks At Newbuildings

New York listed Overseas Shipholding Group has secured a USD 389 million, 12 year secured facility from the government owned Export-Import Bank of China (“China EXIM bank”), in the bank’s first loan facility extended to a US company. The borrowings will be used to finance three VLCCs and two Aframax crude oil tankers built in China.

In another transaction, the Export-Import Bank of Korea (“KEXIM”) has extended a USD 142 million pre and post delivery term loan facility for two new VLCC vessels being built at STX Shipbuilding and Marine Co., Ltd to be chartered to STX Pan Ocean Co., Ltd. The transaction team consisted of partner Chris Lowe and associate Chien Herr Lee of Singapore office of Watson, Farley & Williams LLP. Continue Reading

Successfully Financed And In Search For More

Thailand based Regional Container Lines (“RCL Group”)’s wholly owned subsidiary in Singapore, RCL Feeder Pte Ltd, has secured a term loan of up to USD 35 million from Overseas Chinese Banking Corporation (“OCBC”) on August 21, 2009. The tenor of the loan will expire 3 years from the drawdown or October 31, 2012 at the latest, and the quantum should not exceed 50% of the market value of the RCL office building in Singapore. Proceeds will be used for working capital.

In a similar transaction concluded on 23 June 2009, another RCL wholly-owned subsidiary in Singapore, Regional Container Lines Pte Ltd, signed a loan facility agreement with DnB NOR Bank ASA, Singapore branch for up to USD 17.5 million or an amount not more than 55% of the combined market value of the vessels under the collateral pool. The loan has a tenor of 5 years from the drawdown and the proceeds will be used to refinance an existing loan.  Continue Reading

Another Standard Chartered Transaction

This week, Standard Chartered has announced a USD 50 million loan facility for the shipping arm of South Africa listed Grindrod Limited. Standard Chartered acted as the sole lender and the loan is secured by a series of ships that will be delivered over the next 18 months. The loan facility will provide Grindrod a source of liquidity to take advantage of opportunities that may arise in the shipping market.

Grindrod is South Africa’s largest and oldest ship owner and it said business environment remains challenging due to reduced economy activity, tight credit markets, lower trade volumes, declining commodity prices and increased counterparty risk.  Profit made in the first half of 2009 fell 77% to USD 27.6 million, from USD 122.2 million in 1H08. Despite the sharp decline in freight rates, the company has still managed to deliver a strong interest cover of 9.0 times in June 2009.  Continue Reading

Marine Money Comes to London

There’s a lot of reasons to visit London. Buckingham Palace, Big Ben, The London Eye, Lloyds of London, St. Mary Axe. Well now there is one more reason. Marine Money International is proud to advise that we are initiating a new London conference on Thursday 21st January 2010 at the The London Marriott, Grosvenor Square.

This will be the first Marine Money conference of 2010 and we intend to start the new year in London with an event to be remembered. London is a natural choice for a Marine Money conference being a major financial and shipping service centre and we are very confident of maintaining our record of high quality content and good attendence.

We are currently building our sponsor lineup and discussing topics for the conference agenda and would welcome any ideas or interested participants. Please contact Mia Jensen at mia@marine-marketing.gr

Jonathan Whitworth Moves to Vancouver

More precisely Jonathan Whitworth has taken on the role of CEO at Washington Marine Group, one of the most dynamic marine businesses around with interests as far ranging as being major sponsor of Seaspan to tugs, barges , log towing, ferries, bunkering, shipbuilding, repair, escort…basically you name it. Terrific match.

Natixis Taking Focus

Natixis in its second quarter presentation explained that it has decided, for the next 3 years, to focus its shipping business on energy related assets, ie. oil and product tankers, gas carriers, offshore support vessels and drilling and production assets.

However, the size of the global shipping portfolio will not decrease, and the various desks and teams worldwide will remain in place. The Bank should therefore be in a position to be more active in this smaller market in the near future.

This new focus on energy related assets is only for new transactions, and no sale of its existing portfolio in non-energy related assets is contemplated.

FORTIS Bank Netherlands and QInvest to Form a $200M Shipping Fund

Fortis Bank Netherlands and Qatar’s largest investment bank are launching a mezzanine fund to invest into commercial ships.

The fund will add important capital to the industry. The fund will be structured to capture value from the potential asset appreciation of vessels, which its principals feel have been too heavily hammered between tighter credit markets and the general economic downturn.
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