Articles

Greater regulation neared as we approached 2024, and the topic of sustainability presented itself more and more frequently. Now, as we venture into the new year, many of the previously expected regulations are headed towards enforcement, and green-linked financing and sustainability programs in both greater numbers and variety are picking up pace. Companies: Nippon Yusen Kabushiki Kaisha, Det Norske Veritas, MUFG Bank 

When the early December press release announcing that credit fund Eurazeo Sustainable Maritime Infrastructure Fund (“ESMI”), advised by Elbe Financial Solutions (“EFS”), had completed its first financing of a hydrogen-powered vessel, and that this deal reflected the halfway point in terms of deployment of the 220 million euro fund, we knew it had been too long since we had checked in with EFS co-founder and CEO Jens Mahnke. And call we did. Companies: Eurazeo Sustainable Maritime Infrastructure Fund, Elbe Financial Solutions, Harren & Partner , Samskip

When the December 21st press release announcing Plano, TX (near Dallas), headquartered Beal Bank’s participation as a lead new lender in Centerline Logistics’ (“Centerline”) $425 mm refinancing coincided with our LinkedIn discovery that it was CSG Investments (“CSG”) Andy Longhurst’s 10th anniversary at the firm (CSG is a global buy-and-hold institution and affiliate of and investment consultant for Beal Bank that houses many of Beal Bank’s business development professionals) we took it as a sign that we should give Andy a call and catch up on things. And call we did. Companies: Beal Bank, Centerline Logistics, CSG Investments, Nordic American Tankers, MPC Container Ships, Kosmos Energy, Lloyds, Maroil Trading Inc.

Debt played a major thematic role throughout 2023, whether it was deleveraging or the prominent roles of private credit and bond markets with tightening interest spreads, then right around the holiday season the Fed graced us with the news of possible rate cuts this year and continuing as far as 2026. Companies: Dorian LPG , Crédit Agricole Corporate and Investment Bank, ING Bank N.V., Skandinaviska Enskilda Banken AB, BNP Paribas, Danish Ship Finance A/S

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It always piques our interest when an asset backed issuance is announced in the maritime sector. Hamburg Commercial Bank (“HCOB”), just recently announced carrying out €500 million in ship mortgage-backed bonds, being the first of its kind we’ve seen from a German bank in a long time. Company: Hamburg Commercial Bank 

Transactions that were held-over during the holidays continued to close this week, and in today’s issue we will highlight a few of them. First up is TORM Plc (“Torm”), who issued a bond with proceeds used to repay the bridge loan used to acquire eight vessels. Companies: ORM Plc , Hayfin, Danske Bank, DNB, Nordea, SEB

It is not often one has the chance to write about the success of a dynamic duo, who so wonderfully, surrounded by great talent created success in every endeavor. But, as the news of the acquisition of Penfield Marine (“Penfield”) by Maersk Tankers is by now well known, it gives us the chance here to also dust off some old quotes from the past about Penfield CEO Tim Brennan and his ability to attract the best talent. Companies: Penfield Marine, Maersk Tankers, Heidmar, Morgan Stanley, Pareto Securities, Ischyra Europa, Seward & Kissel

The year 2022 witnessed persistent global financial market instability due to a combination of factors, including the aggressive interest rate hikes by central banks worldwide driven by high inflation, and geopolitical uncertainties like the war in Ukraine. These conditions resulted in a substantial decline in bond prices.

We expect many of the trends seen in 2023 to continue in 2024. Subdued inflation has given the U.S. Fed confidence in signaling rate cuts three times in 2024, which has lifted the equity markets and will come as relief to some shipping borrowers. On the other hand, a US recession, which is deemed likely, and another unforeseen global crisis could damage the economy.

Once or twice each decade there is a new and noteworthy chapter in the evolution of ship finance – and they are usually caused by excess liquidity. In the late 1990s, it was a period of junk bond mania (31 offerings) immediately followed by several years of restructuring. In the 2000s, investor demand for participation in the “China Boom” spawned dozens of equity offerings, IPOs and MLPs, many of which are now gone. Companies: Scorpio, Ardmore, Castor, Eagle, Danaos, Oak Tree’ Frontline, Euronav, Taylor, Grindrod

Solstad Offshore ASA (“Solstad”) and its subsidiaries were one of many offshore companies that sought to refinance during 2023, only a few years after many of them restructured, went bankrupt, cancelled projects and more. Amidst the global chaos, demand for oil and gas erupted, and offshore has found itself a second wind. Companies: Solstad Offshore ASA, Aker ASA, AMSC ASA, DNB Bank ASA, Export Finance Norway, Pareto Securities, Wikborg Rein

Last year, B. Dyson Capital Advisors (“B. Dyson”) won our award for Equity-Linked Deal of the Year with a Convertible Bond Exchange completed for Scorpio Tankers (“Scorpio”). We said they “helped Scorpio to design and execute a solution that looked artful at the time but now looks downright genius.” This year they are at it again with a strategy for dry bulk operator Diana Shipping (“Diana”), which again looks artful but only time will tell if it’s again genius! Companies: B. Dyson Capital Advisors, Scorpio Tankers, Diana Shipping

Ours is a remarkably complex global industry. Meeting the demands of global supply chains, safely, with respect for the women and men around the world engaged in this vital business is demanding of great skill.

Earlier this month, Hunter Group ASA entered into a three-year back-to-back charterparty on an eco-design and scrubber fitted VLCC built in 2016, with an internationally renowned counterparty. The vessel will be chartered-in at a fixed rate of $52,500 per day. At delivery, the vessel was fixed, back-to-back, on a floating index linked TD3C spot rate charter earning $62,250/day based upon the then current rates and fuel prices. Companies: Hunter Group ASA, DNB Markets, Fearnley Securities

It has been two years since John Fredriksen made his initial investment in Euronav. Now, as the Saverys family moves towards Euronav’s acquisition of CMB Tech (“CMBT”), a private business owned by the Saverys family, we thought it would be worthwhile to provide a summary of the key events to date. Companies: Euronav, CMB Tech, Frontline

The past year was one of intense discussions surrounding the energy market: what source is green enough, has readily available infrastructure/availability, and is energy dense enough as carbon taxes emerge in 2024? Not only that, but increased conflicts globally have stressed the need for energy independence – coincidentally with the “green revolution.” Companies: Energos Infrastructure, Dynagas, Gaztransport & Technigaz

As cash-rich owners look to grow their businesses without making vessel purchases at a high point in the cycle, we have noted a significant pick up in M&A activity among maritime services companies. One recent example is the acquisition of Zeaborn Ship Management (“Zeaborn”) by MPC Capital (“MPC”), a Hamburg-based asset management firm, in conjunction with Wilhelmsen Ship Management (“Wilhelmsen”), on the 21st of December 2023. Companies: Zeaborn Ship Management, MPC Capital, Wilhelmsen Ship Management, Oaktree, OSM, V.Ships, Zech Maritime Holdings, Tufton Investment Management, United Heavy Lift

Strengthening balance sheets, consolidation, tighter interest spreads, the resurgence of offshore, chaotic does not begin to describe this year, but luckily shipping appreciates chaos!

Pacific Basin Shipping Limited announced the successful closing this month of a new $150 million Sustainability-Linked three-year Senior Unsecured Committed Revolving Credit Facility (the “Facility”), representing the company’s first syndicated unsecured revolving credit facility and its inaugural sustainability-linked loan facility. Companies: Pacific Basin Shipping Limited, BNP Paribas, Citigroup, Hong Kong and Shanghai Banking Corporation, Iyo Bank, SBI Shinsei Bank, Skandinaviska Enskilda Banken