PanOceanic Bulk Carriers: Just Under the Wire

by Alan Ginsberg

PanOceanic Bulk Carriers Ltd.’s $100 million offering of First Preferred Mortgage Notes in December brought to a close the shipping industry’s busiest year ever for accessing the high yield segment of the capital markets. By our calculations, approximately $1.2 billion was raised by seven issuers on both a secured and unsecured basis (The figures are higher if Cambridge’s two oil major bareboat charter newbuilding deals [Golden State and Windsor] are factored in.) We saw some old names rise from the grave and some new names, as well as newly formed companies, take the plunge. While the majority of projects were for identified secondhand tonnage, there were also funds raised for newbuildings. As might be expected, tanker projects led the way, but there were also funds available for dry bulk and container feederships. Only the reefer segment was conspicuously absent. Looking to the year ahead, as counter-cyclical investors, we see the clock is ticking on the wet side, increasing promise on the dry side, particularly if the markets come off enough, and plenty of room for specialty tonnage.

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