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Thursday, 27 February 14
SHIPPING LOANS WORTH $5 BILLION HAVE CHANGED HANDS OVER THE PAST YEAR, AS FUNDS INVEST IN SHIPPING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Funds investing in shipping has been the "talk of the town" over the past couple of years, as institutional investors, private equity and hedge funds have all emerged as newcomers to the shipping financing segment, often assuming the role of traditional shipping banks, which have exited the market, or cut their exposure. According to the latest weekly report from shipbroker Intermodal, the vast majority of those funds have been consumed in buying up shipping loans. "About $5 billion in shipping loans have changed hands in the past year and demand is driving loan prices to levels almost in line with book values", said the shipbroker.
According to an analysis by Intermodal's SnP broker George Dermatis, these funds "do not hesitate taking over entire fleets and even align themselves with several managers in an insatiable escapade to take over debts and even ships/assets on their balance sheets. Funds tolerate systemic risk much more than traditional banks that are massively exiting or reducing their exposure in the sector. So one could argue that one player is filling up the void the other creates. Therein lays the paradox" he noted.
Dermatis said that "the characteristics of traditional banks are undoubtedly much more to the liking of traditional shipowners; no exit strategy other than full debt repayment, name lending based on interpersonal relationships, which in some cases dates back decades, experience over several shipping cycles and the list goes on. The industry perceives this as an overall alignment of interests. Private Equity funds stand more or less at the other side of the road on all of these points and that creates nervousness to most being afraid of how fast these investors can climb the learning curve or lose their interest in the process".
According to the broker, "the truth is that shipping largely remains in the hands of its professionals, who live and breathe the essence of this sector and who -to a large extent- have assigned a negative connotation to the publicity that funds along with capital markets and OTC offerings gather. So, despite the fact that financing from these sources has in many times arrived when no other source of funding was available, the truth is that our industry still views them with skepticism. My personal feeling is that people spend too much time “loving or hating” a way of financing whose significance has been grossly overestimated - at least for the time being", Dermatis mentioned.
He went on to add that "despite the fact that numbers -especially last year's- are indeed impressive, it seems that equity funds do not contribute more than $6-7bn on average per year, which seems like a drop in the ocean when compared to conventional debt financing by banks which continues to provide around $250bn annually according to Marine Money. During the peak times of 2008, these figures stood close to $500bn (!!!) and this should therefore be sufficient to hush down fears that private equity alone could lead to a bubble or that it could even distort market reality... The main worry linked to overcapacity remains and the finance gap on newbuilding orders persists if not broadens. The latest available data speaks of figures of over $125bn... Whilst the presence of “new” money is duly noted, we all need to realize that the industry must be able to carry its own weight. If that means changing our processes, transparency levels, corporate responsibility standards, etc. in order to bridge this gap and attract a greater share of their attention, then maybe this is a change we should embrace", Dermatis concluded.
Meanwhile, in the dry bulk market this past week, things continued to improve on the back of rates for the smaller size segments holding on to their levels and those for Capes correcting upwards, said Intermodal, while the spill-overs of the improved sentiment have yet to affect the Panamax market. Nevertheless, the BDI ended yesterday on yet another higher note, ending the session at 1,222 points.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 21 March 14
MERCURIA ANNOUNCES ACQUISITION OF J.P. MORGAN PHYSICAL COMMODITIES BUSINESS
COALspot.com: Mercuria Energy Group announced that it has reached a definitive agreement with J.P. Morgan Chase & Co. to acquire its physica ...
Thursday, 20 March 14
CAPESIZE: WEST AUSTRALIA TO CHINA RATES HAVE CLIMBED BACK TOWARD USD 11 PMT - FEARNRESEARCH
Handy
From a slight improvement in the Atlantic to a more mixed picture this mid week. North Atlantic rounds showing softening signs whereas S ...
Wednesday, 19 March 14
INSTEAD OF DECIDING WHETHER THE GLASS IS HALF FULL OR HALF EMPTY, I AM CURRENTLY GLAD THERE IS WATER IN THE GLASS - EVA TZIMA
By Eva Tzima
Research Analyst
Intermodal Research & Valuations
Right when you think that you have all your facts straight, right wh ...
Wednesday, 19 March 14
EUROCOKE SUMMIT 2014
Press Release: ThyssenKrupp, Steel Institute VDEh, SSI and more headline Smithers Apex’s Eurocoke Summit
The leading coke, coal and s ...
Wednesday, 19 March 14
DRY BULK MARKET REBOUND LEADS TO MORE NEWBUILDING ORDERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The steady rise of the dry bulk market, as evidenced by the return, yesterday, of the Baltic Dry Index above the 1,500-point mark (1,518), is fu ...
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- Romanian Commodities Exchange
- Iligan Light & Power Inc, Philippines
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- Global Green Power PLC Corporation, Philippines
- Heidelberg Cement - Germany
- MS Steel International - UAE
- Merrill Lynch Commodities Europe
- Karbindo Abesyapradhi - Indoneisa
- VISA Power Limited - India
- Directorate Of Revenue Intelligence - India
- OPG Power Generation Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Metalloyd Limited - United Kingdom
- White Energy Company Limited
- Australian Commodity Traders Exchange
- IHS Mccloskey Coal Group - USA
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- ICICI Bank Limited - India
- Kaltim Prima Coal - Indonesia
- Bhushan Steel Limited - India
- Electricity Generating Authority of Thailand
- Eastern Energy - Thailand
- Electricity Authority, New Zealand
- Leighton Contractors Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Mines - Canada
- GVK Power & Infra Limited - India
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
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- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Alfred C Toepfer International GmbH - Germany
- New Zealand Coal & Carbon
- GMR Energy Limited - India
- Energy Link Ltd, New Zealand
- Straits Asia Resources Limited - Singapore
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- Riau Bara Harum - Indonesia
- Uttam Galva Steels Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Banpu Public Company Limited - Thailand
- Agrawal Coal Company - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Altura Mining Limited, Indonesia
- Madhucon Powers Ltd - India
- Chettinad Cement Corporation Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bharathi Cement Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Coalindo Energy - Indonesia
- Videocon Industries ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Australian Coal Association
- Indian Energy Exchange, India
- Vizag Seaport Private Limited - India
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- Siam City Cement PLC, Thailand
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- The University of Queensland
- Marubeni Corporation - India
- Bulk Trading Sa - Switzerland
- Minerals Council of Australia
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- Coal and Oil Company - UAE
- ASAPP Information Group - India
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Rio Tinto Coal - Australia
- Barasentosa Lestari - Indonesia
- Sojitz Corporation - Japan
- Bukit Makmur.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Grasim Industreis Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Orica Australia Pty. Ltd.
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Wilmar Investment Holdings
- Manunggal Multi Energi - Indonesia
- Xindia Steels Limited - India
- London Commodity Brokers - England
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- European Bulk Services B.V. - Netherlands
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Lanco Infratech Ltd - India
- Maheswari Brothers Coal Limited - India
- Ceylon Electricity Board - Sri Lanka
- Savvy Resources Ltd - HongKong
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Siam City Cement - Thailand
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Deloitte Consulting - India
- Sical Logistics Limited - India
- AsiaOL BioFuels Corp., Philippines
- Indogreen Group - Indonesia
- Oldendorff Carriers - Singapore
- Makarim & Taira - Indonesia
- Renaissance Capital - South Africa
- Kobexindo Tractors - Indoneisa
- Central Java Power - Indonesia
- Aditya Birla Group - India
- TeaM Sual Corporation - Philippines
- Tamil Nadu electricity Board
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- PTC India Limited - India
- Eastern Coal Council - USA
- Gujarat Sidhee Cement - India
- Global Coal Blending Company Limited - Australia
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Kalimantan Lumbung Energi - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
- Pendopo Energi Batubara - Indonesia
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- San Jose City I Power Corp, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Power Finance Corporation Ltd., India
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Vijayanagar Sugar Pvt Ltd - India
- Commonwealth Bank - Australia
- Parry Sugars Refinery, India
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Formosa Plastics Group - Taiwan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- Trasteel International SA, Italy
- Africa Commodities Group - South Africa
- Sree Jayajothi Cements Limited - India
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Latin American Coal - Colombia
- Orica Mining Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Thiess Contractors Indonesia
- Georgia Ports Authority, United States
- PowerSource Philippines DevCo
- Carbofer General Trading SA - India
- Interocean Group of Companies - India
- Sindya Power Generating Company Private Ltd
- Ministry of Finance - Indonesia
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- Bangladesh Power Developement Board
- Bukit Baiduri Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- The Treasury - Australian Government
- Coastal Gujarat Power Limited - India
- Mintek Dendrill Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Transport, Egypt
- Attock Cement Pakistan Limited
- Global Business Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Sarangani Energy Corporation, Philippines
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Indika Energy - Indonesia
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