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22 Jul 2017

Singapore Exchange approves Rickmers Maritime's delisting

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"Rickmers Maritime, the failed boxship leasor of Bertam Rickmers, will be delisted from the Singapore Exchange (SGX), 10 years after its IPO, back when shipping trusts were all the rage in the Lion Republic. With Rickmers Maritime beign wound up following massive losses, its manager has sought to delist with shareholders braced for a big loss. Rickmers Maritime claimed in a release the trust the trust is unable to make a reasonable exit offer to unitholders, and that no net cash proceeds will remain for distribution to unitholders following the disposal of the property of the trust, repayment of borrowings to its secured creditors and unsecured creditors and retention of certain, unspecified amounts permitted under the trust deed constituting the trust. ''[U]nitholders will not receive any recovery or distribution in connection with the winding up of the Trust,'' the comapny stressed in a release. The bust company also said there was not chance of any corporate rehabilitation. SGX for its part said it had no objection to the proposed delisting. A date for Rickmers Maritime exit from the SGX will be announced shortly."

19 Jul 2017

PIL seen as next takeover target after OOCL

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"Pacific International Lines (PIL) is the next most likely takeover target in the fast-consolidating container shipping industry following last week’s $6.3 billion sale of Hong Kong’s OOCL to China Cosco Shipping, with the Chinese carrier seen as the most likely suitor for the Singapore-based company, according to maritime analyst Alphaliner. PIL wasn't immediately available for comment. The OOCL deal has left just four independent mid-scale carriers, each with market shares of between 1.5 percent and 2.8 percent, the industry analyst said. In the market for US imports from Asia, PIL had a market share of 1.5 percent in the second quarter, when the new global container shipping alliances launched, up 0.6 percentage points year over year, according to PIERS, a sister unit of JOC.com. PIL’s volume on the trade rose 67 percent in the same period to 58,407 TEU. Click to Enlarge Three of the carriers — Yang Ming, Hyundai Merchant Marine, and Zim Integrated Shipping Services — are government-linked, which makes them unlikely takeover targets outside their home nations of Taiwan, Korea, and Israel. The carriers’ cash-strapped status will further deter potential buyers, Alphaliner suggested. Yang Ming is in the midst of a recapitalization program mainly supported by the Taipei government, while HMM and Zim were financially restructured in 2016 and 2014, with their creditors acquiring significant stakes via debt-for-equity deals. “This leaves PIL as the only unencumbered candidate, and its niche position, in particular, on Africa-related trades, could make the carrier an attractive target for buyers keen on securing access to this emerging market,” Alphaliner said. Unlike its counterparts, PIL recently had to raise cash from asset disposals and provide collateral to secure bank loans to settle its outstanding debt. PIL is said to have sold two 2012-built capsize bulk carriers this year for just $26 million to 28 million apiece, taking a significant loss, and has pledged its shares in Singamas, the Hong Kong-listed container manufacturer in which it has a 41.1 percent stake, to raise bank loans of around $180 million. The proceeds from the sale of the bulk ships were used to pay off S$300 million ($219 million) of bonds due on July 17. PIL is obliged to sell its Singamas shareholding within 20 months for at least $180 million or at a price acceptable to its creditors, according to a stock exchange filing by the Hong Kong-based company on July 11. PIL, which is controlled by the Chang Teo family, does not publish regular financial reports, but it posted a significant net loss in 2016, due to “very low freight rates and a one-off bunker hedging loss” in the first half of the year. The company carries a total debt of more than $2.6 billion, according to Alphaliner. PIL has a close strategic alliance with Cosco, built up over recent years — it established a partnership with the Chinese carrier on the west and east Africa trades in 2016 and earlier this year signed a vessel sharing deal with Cosco and Wan Hai on the trans-Pacific trade. The carrier is due to take on the first of 12 new Chinese-built and financially-backed 11,800-TEU ships later this year and is expected to “rely heavily” on Cosco to find work for the new vessels, which are targeted at the trans-Pacific trades, including a planned entry into the US East Coast market in 2018. PIL and the other independent carriers have so far limited their efforts in the trans-Pacific to the US West Coast, but SM Line also plans to enter the US East Coast trade next year. In 2008, four Algerian men arrived in Halifax aboard a ship by hiding on a double-decker bus that was being transported to Canada from Liverpool, England. The bus was bound for Toronto, where it was to be part of the GO Transit fleet. In 2001, 36 Chinese stowaways were discovered to have spent two weeks in a container on the M.V. Pretty River after a worker at the Port of Vancouver heard voices coming from the other side of the metal walls. One of the illegal passengers claimed that the stowaways were destined for California, which was the ship’s final destination. Michael Broad, president of the Montreal-based Shipping Federation of Canada, said ships have security officers to track who gets on and off vessels and there is intense security at ports, including fencing, guards, cameras and 24-hour surveillance, in an effort to prevent illegal migrants and other unwanted activity. “It’s been quite some time since this has occurred and I can’t tell you the last time anyone was found in a container,” he said, adding that containers are sealed with a lock before they are loaded onto a ship. Stowaways that arrive in Canada are permitted to make an asylum claim, like any other prospective refugee applicant. But the shipping company responsible for the vessel on which stowaways arrive must pay a $25,000 bond to the federal government. That money is used to pay the costs of deporting the individual if their refugee claim is denied."

03 May 2017

Cyber security is everybody’s responsibility: new poster for ships launched in Singapore

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"BIMCO, International Chamber of Shipping (ICS) and Maritime and Port Authority of Singapore (MPA Singapore) launched a new cyber security awareness poster at Singapore Maritime Week 2017. The launch was greeted with enthusiasm by the audience discussing cyber security at the Singapore Maritime Technology Conference and Exhibition. The poster provides basic information to shipboard personnel on their role and contribution to managing maritime cyber risks. It also highlights how staff need to be aware of how to respond effectively to cyber risks. The advice complements information provided on procedural protection measures also available in the industry Guidelines for Cyber Security Onboard Ships. Giles Noakes Head or Maritime Security at BIMCO says: “Whilst shipboard personnel are one of the major cyber vulnerabilities, with improved basic awareness, they can contribute to ensuring that company approaches to managing cyber risks are effective. This poster provides all the information they need in a clear and accessible form”. MPA Singapore will distribute the A3 size poster through their pilots for ships calling at Singapore ports. The poster will also be made available in an electronic format for download from the BIMCO and ICS websites for use by shipping companies. "

02 May 2017

Thome Opens Modern Training Facility in The Philippines

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"Thome Ship Management Pte. Ltd., has opened a modern training facility in Makati city in the heart of the Philippines, so that its seafarers and cadets can practise using the latest equipment which will be the same as the machinery they encounter once onboard. All guests were welcomed by Capt Ivar Thomasli, Managing Director of Thome Ship Management – ROHQ, followed by the ribbon - cutting ceremony led by Thome Group Executive Chairman, Olav Eek Thorstensen, President and Chief Commercial Officer (COO), Claes Eek Thorstensen, Deputy Managing Director Sartaj Gill and Regional Training Manager Capt. Dante Bo. The Thome Training Workshop and Dormitory can accommodate up to 50 seafarers/cadets and comes complete with Wi-Fi, 10 standalone CBT computers, and various state-of-the-art facilities and equipment that meets the key vessel requirements of Thome’s principals. Some of the on-site equipment includes: · FRAMO Pumping System which includes its own Power Pack and Tank · SCANJET Tank Cleaning Machine · JOWA Oily Water Separator · 38 KW Generator (220/440 Volts) · YANMAR Diesel Engine, Screw Type Air Compressor (9.5 Bars) · TANABE Reciprocating Air Compressor · ALFA LAVAL Purifier · IHI Turbo Charger · SCHMIDT Blasting and Paint Coating equipment Several training courses are available to help cadets and seafarers such as: · Pre-Sea Training for Cadets · Engine OIC Enhancement Course 1 (newly-licensed OIC and existing 4/E) · Engine OIC Enhancement Course 2 (3/E and 4/E for promotion) · Engine Senior Enhancement Course (C/E and 2/E) · FRAMO Operation Course · FRAMO Maintenance Course · COW/IGS · Advanced OIL/CHEM Training (Senior Officers’ Workshop) · Advance OIL/CHEM Training (Ratings’ Workshop) “Having such a modern and up to date training facility based in the Philippines where we recruit many of our cadets and crew is so important to maintaining a consistent level of well trained and motivated seafarers,” said Claes Eek Thorstensen, President and COO of the Thome Group. “Being able to accommodate up to 50 seafarers in our dormitory at any one time is also important as we expand the ethnicity of our personnel with a growing number recruits coming from Asian and eastern bloc regions,” he continued. "

19 Apr 2017

Understanding reached on the financial restructuring of the Rickmers Group

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"Rickmers Holding AG reached an understanding on a term sheet regarding the restructuring of material financial liabilities of the Rickmers Group, that is still subject to corporate approvals of the creditors and contingent on restructuring of the bond 2013/2018 issued by Rickmers Holding AG (ISIN: DE000A1TNA39 / WKN: A1TNA3) (“Rickmers Bond”) as set out below. The envisaged restructuring is to enable reorganisation of the Rickmers Group on the basis of contributions of all relevant stakeholders, i.e. in particular the sole shareholder Bertram R.C. Rickmers, the financing banks and the bondholders. As contribution to the restructuring, under the term sheet Bertram R. C. Rickmers undertakes to make a cash contribution of EUR 10 million, to relieve the Rickmers Group from a shipyard liability of a further USD 10 million, to waive licensing fees up to the end of Q1 2021 and to procure a back-up loan facility of up to a further EUR 10 million for possible future liquidity requirements of Rickmers Holding AG. The sole shareholder already made a cash contribution of EUR 13 million into Rickmers Holding AG in 2016. Bertram R. C. Rickmers is also prepared to reduce his stake in Rickmers Holding AG from 100% to 24.9% in order to enable key creditors, i.e. HSH Nordbank AG, the bondholders and possibly one further bank, to acquire a total stake of 75.1% in Rickmers Holding AG as part of the restructuring plan. To this end, a Luxembourg vehicle (“LuxCo”) shall assume all liabilities of Rickmers Holding AG under the Rickmers Bond, such that the LuxCo shall replace Rickmers Holding AG as the debtor of the bond. The LuxCo shall also assume as debtor a partial amount under a loan from HSH Nordbank AG. In connection with these assumptions the LuxCo shall acquire a 75.1% stake in Rickmers Holding AG. A joint representative yet to be appointed by the bondholders shall be authorised to approve a sale of shares in Rickmers Holding AG held by the LuxCo following an investor solicitation process yet to be conducted and to distribute the proceeds to HSH Nordbank AG, the bondholders and possibly to one further bank, according to a defined allocation formula. Payment of the interest coupon of 8.875% on 11 June 2017 shall be exempt from the above debt assumption under the Rickmers Bond. The payment is to be made in full by Rickmers Holding AG on the condition that a resolution of the bondholders on the appointment and authorisation of a joint representative has been passed by such time. Besides the above mentioned contributions by the shareholder and the consent to the assumptions of debt by LuxCo the restructuring concept provides for contributions of other creditor banks and of one shipyard, inter alia in the form of deferrals of repayments, release of pledged funds and reduction of interest margins. The management board of Rickmers Holding AG has tasked a leading international auditing firm with providing an expert report on the possibility of successfully restructuring the Rickmers Group within the meaning of IDW Standard S6. In the current draft restructuring report, which is almost finalised, the auditing firm concludes that the Rickmers Group can be successfully restructured if all proposed restructuring measures are implemented. The restructuring report was prepared with the involvement of all relevant stakeholders, including the bondholders’ designated joint representative. It enables a solvent continuation of Rickmers Holding AG at terms which, pursuant to the present liquidation value report, are considerably more favourable for the bondholders than an insolvency of Rickmers Holding AG would be. Should the corporate bodies of the creditors and/or the bondholders not approve the proposed restructuring, the restructuring would likely fail and the going concern forecast of Rickmers Holding AG would likely no longer apply."

17 Apr 2017

Shipping industry in much better place than 12 months ago: SSA president Poulsson

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"The shipping industry, in particular dry bulk and containers, has seen a marked improvement over the last 12 months according to Singapore Shipping Association (SSA) president Esben Poulsson. “Overall I would say we are in a much better place than 12 months ago… especially dry bulk and containers,” Poulsson told a media briefing for Singapore Maritime Week (SMW) 2017. Looking at the dry bulk sector he said there was a lot of optimism at the moment. The Baltic Dry Index is currently at around 1,200 points, compared to an all time low of 290 points in February 2016. However, he added, “I hope we don’t repeat the mistakes of the past, we have to hope any ordering will be moderate.” In the container sector Poulsson said that the bankruptcy of Hanjin Shipping had acted as a real wake up call. “That led to more discipline in terms of the supply side….that has led to rate levels coming back to levels that are beginning to be sustainable.” On the question of consolidation in container shipping saw five mergers and acquisitions being announced in little more 12 months he said there was “still more to be done” but it would not be at the pace seen in 2016. Looking at the tanker sector Poulsson commented: “The tanker market is volatile and there are many ifs and buts. The supply side looks quite stable, but there is a lot of potential supply coming onstream.” Poulsson was even hopeful that the offshore marine sector was past its worst despite overcapacity of “huge proportions” for rigs and supply vessels. The global fleet of supply vessels has quadrupled from 1,000 in the early 2000’s to 4,000 today, with another 700 – 800 newbuilds to be delivered this year. “There is an enormous overcapacity that will take time to work through, but it is very much related to oil price,” he said. “Nonetheless, I’m still reasonable optimistic. I don’t think there’s going to be upturn in the offshore industry over night, but I think the worst is over time it will return to a healthy balance.” As to whether the Singapore government should provide more support to companies in the maritime and offshore sectors going through financial difficulties Maritime & Port Authority of Singapore (MPA) chief executive said market forces had to be allowed to take their course. “As a maritime centre we are at a stage where there has to be some economic restructuring, and the restructuring has to be allowed to take its course. So we provided some targetted assistance to the maritime sector, but in terms of standing in the way of this restructuring we have to allow market forces to pan out. “What we can do is help the industry prepare for its long-term capabilities when the market upturns,” he added."

13 Apr 2017

Rickmers Maritime in sales talk

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"Container ship owner Rickmers Maritime Trust is to be wound up following the failure to reach an agreement with lenders to restructure the Trust’s debts. According to data from VesselsValue, the trust owns 14 container vessels worth US$89m, all from the Panamax class which has suffered following the expansion of the Panama Canal. Rickmers Trust Management Pte, the trustee-manager, is currently in advanced discussions with a potential buyer for the Trust’s assets which may allow the Trust to distribute cash recoveries upfront to unsecured creditors. It noted that the failure to reach a restructuring deal led to the non-payment of US$196.7m to the HSH Syndicate, which was due on March 31, 2017. There was a further failure to pay S$4.3m to noteholders in November 2016 as well as various breaches in loan covenants. “This situation places the Trust in a situation of aggravated and unsustainable illiquidity going forward,” the trustee-manager stated in a stock filing. HSH had granted Rickmers Trust Management Pte until April 15, 2017, to present a new restructuring proposal which would ensure a higher level of total recoveries than under a winding up of the Trust. However, although it hoped to secure debt forgiveness from HSH for the existing loans, potential investors were dissuaded by considerable challenges in obtaining significant debt write-offs. “It is expected that the business operations of the Trust’s vessels will remain unaffected by this process and that the Trust will continue to meet its ongoing charter party obligations to its customers,” the stock filing added."

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