Basil M Karatzas to speak at the Tugs, Towboats & Barges (TTB) Conference

image descriptionBasil M. Karatzas, Founder and CEO of Karatzas Marine Advisors & Co.

In a tough market, how can inland and coastal operators finance projects such as newbuilds needed when the costs of Sub M compliance make keeping older tonnage on the water increasingly expensive?

Among the speakers at Marine Log’s TTB – Tugs, Towboats & Barges event will be Basil M. Karatzas, founder and CEO of Karatzas Marine Advisors & Co., a shipping finance advisory and ship-brokerage firm based in New York City. His topic: “Finding access to capital for brown water Jones Act operations.”

Karatzas has diverse maritime industry expertise in the fields of shipping finance, port operations, charterers’ and husbandry agency, charter and ship brokerage, and vessel management and operations. In an advisory capacity, he has originated and executed multiple finance-oriented transactions in shipping such as sale & leaseback transactions, private placements for equity, mezz, debt and structured finance.

To be held at the Renaissance Mobile Riverview Plaza in Mobile, Ala., March 24 & 25, TTB will build on our previous TUGS & BARGES events but with expanded waterways industry coverage.

Check out the program and register to attend HERE

We are looking forward to seeing you in Mobile, Ala., at the end of March at the TTB Conference by Marine Log, and discussing not only current (and exciting) developments in the inland tug, towboats and barge in the “brown water” market, but also for coastal shipping, Jones Act ocean-going markets, offshore in the GOM, but also financing ideas and opportunities for making the best under the challenging market conditions!

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NOTICE: THIS BLOG UPDATES INFREQUENTLY; NEW POSTINGS APPEAR ON KARATZAS AUCTIONS – PLEASE FEEL TO FOLLOW US THERE!

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© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

A Shipping Finance Conference in Athens, a Great Success Story!

Profoundly thankful to the speakers, sponsors, participants and attendees for the immensely successful Slide2Open Karatzas Shipping Finance Conference 2019!

Proudly co-organized by Karatzas Marine Advisors & Co.

© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

To access the conference website including presentations, proceedings, interviews and panel discussions, please click here!

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

Karatzas Marine and Slide2Open to Host 2nd Shipping Finance Conference in Athens on January 24th, 2019

Building upon the successful inaugural conference held in February 2018 at the Intercontinental Hotel in Athens, Greece, Karatzas Marine Advisors & Co and Slide2Open are thrilled to announce that next year’s conference will be held on January 24, 2019. Save the date!

An expanded agenda on shipping finance, new environmental regulations, innovation and disruption, but also analysis of international trade and geo-politics, and an alignment of  speakers and thought leaders of the highest caliber in their fields, are guaranteed to render this conference a “must attend” event.

For more information, please feel free to contact us by email at:   info[at] bmkaratzas[dot]com or at info[at]Slide2open[dot]net or make sure to follow our blog for regular updates, or follow the conference website at Slide2Open Shipping Finance 2019!

© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

Where Money in the Maritime Industry Will Come From?

Ships are expensive assets, even small pleasure boat owners know. A small handysize bulker of 32,000 dwt has cost no less than $20 mil as a newbuilding even during weak markets; on the other hand of the spectrum, crude oil supertankers (VLCCs) currently cost appr. $85 mil brand-new, while LNG tankers cost almost twice as much.

Being a successful shipowner, therefore, requires access to capital, as plentiful and as at low cost as possible. Even flamboyantly rich shipowners do not have enough money to own outright their fleets (in most cases), and they have to depend on financial “leverage” and financial partnerships.

Banks traditionally had been providing most of the financing in the maritime industry; throughout business cycles, banks could be depended upon to provide 50-80% leverage, usually in the form of a first preferred ship mortgage – just like a bank would provide a mortgage loan for a residential property, with the asset as collateral. There have been dedicated banks to shipping (typically Scandinavian, British and German due to maritime history) and several more banks were transient in the industry when times were good. And, while easiness of financing varied depending on the phase of the business cycle, it was always available, as long as the shipowner had an impeccable record honoring previous commitments to the banks.

A decade after the Lehman Brothers collapse, banks are heavily regulated (although there is talk of late of loosening banking regulations, at least on one side of the pond), and ship mortgages and asset-backed financing are not the preferred line of business any more. In addition, many banks with shipping exposure are actively still selling shipping loans, trying to cut their exposure to the industry to nil. And, for many shipping banks with big losses from their shipping portfolios, it’s hard to convince senior management and shareholders on the appeal of the shipping industry these days anew; in some corners, shipping and maritime have become dirty words.

Besides small lending on a very selective basis by a handful of small banks for ship mortgages, so small that almost does not matter, traditional lending by the banks is a dead business. There is much more activity in terms of corporate lending to shipowners with big balance sheets and consolidated financials, and with long term and “bankable” charter employment, but there are relatively few such shipowners. The majority of the shipowners are smaller companies, trading their vessels in the spot market, and taking preponderous exposure to the vicissitude of the freight markets.

It has been estimated that shipping banks loan portfolios stood at close to $600 billion at the peak of the market in 2008, which is a very big funding gap to fill.

There has been a plethora of so-called credit funds entering the shipping finance market and aiming at filling the funding gap left behind by the shipping banks. Credit funds has been a new mania on the Wall Street, as such funds try to exploit the inability and inefficiency of the regulated banks to service small and mid-sized companies and companies that cannot “tick all the boxes” of a traditional lender. A recent article in the Financial Times states that between 2010 and now, credit funds based in North America doubled in capacity from app. $75 billion to more than $160 billion, so much so that “shadow banking” started being a concern. Credit funds active in shipping are usually funds dedicated to the industry and not part of multi-industry funds, and often are set up and managed by private equity funds and institutional investors with prior exposure to shipping. Fine print aside, credit funds usually charge at least 7% spread over Libor, with several of them well into double-digit territory. No-one expected credit funds to be as “cheap” as bank loans, but at 700 bps minimum margin, shipowners can barely claim that they have access to effective capital. After the honeymoon period of the first entrants to the market, credit funds cannot be the dependable source of capital the shipping industry requires, it seems.

Looking into equity, in the last decade, when the freight market was the best in a lifetime and equity markets were buoyant, there were several attempts of Initial Public Offerings (IPOs) by several shipping companies. Their track-record aside, public equity markets at present are looking for only large (billion-plus balance sheet, etc) and well established shipping companies with a “story”, hopefully a story of growth; for many of the smaller shipowners, the public equity (and debt) markets cannot be considered a source of capital, another dead-end for shipping financing.

Chinese leasing recently has been in the news as many Chinese lessors are looking into expanding aggressively in the international shipping market, and they have been active with sale-and-leaseback transactions. Although more bureaucratic than western financing, their overall terms are rather lenient – but again, for shipowners with sizeable fleets and consolidated financials.

Many industry experts have been contemplating what the source of capital will be for shipping. It’s really a very critical question to answer, and we think, it will affect the nature of the shipping industry in the years to come. Karatzas Marine Advisors & Co even held a shipping finance conference in Athens in early 2018 focused on just such question, and a follow up conference is already in the works for January 2019. Because of shipping finance (and also new regulations, etc), we believe that the shipping industry is at an inflection point where drastic changes are about to take place. Likely shipping in the next decade and the decades to come will be of a different nature, and that’s mainly because the nature of the shipping finance is a-changing. A great deal of shipowners will be materially affected by it, unless they start being pro-active right away.


© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

 

Karatzas Marine Advisors & Co. to Host Shipping Finance Conference in Athens, Greece

Karatzas Marine Advisors & Co Proudly Hosts the Shipping Finance Conference 2018 in Athens, Greece, on February 22nd,  in co-operation with Slide2Open and Boussias Communications.

Please join a group of high caliber speakers and thought leaders in the maritime industry discussing the current state of the shipping industry, the challenges and opportunities looking forward, in presentations, panel discussions and Q&A sessions in modules ranging from shipping finance and investment opportunities to disruptive technologies and e-commerce in shipping and related industries. This will the first conference in this agenda-setting must-attend series of events on shipping and shipping finance to  be hosted by Karatzas Marine Advisors & Co and their business associates.

We are looking forward seeing you in Athens on February 22nd, 2018!


© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

Topical Insight and Current Developments in the Maritime Industry

Basil M Karatzas and Karatzas Marine Advisors Quoted in the News

We are delighted that Karatzas Marine Advisors & Co. and its founder Basil M. Karatzas have been the trusted and insightful source of market knowledge and intelligence for all things maritime; with prompt and accurate access to market information, a vast network of resources and paramount access to senior executives worldwide, in the shipping and complimentary industries, the company and its founding partner have had a front row seat to today’s developments in the maritime industry.

We always thought that we have had a strong advantage over the competition and nothing gives us higher pleasure than seeing our expertise appreciated beyond a constant deal-flow and boardroom discussions with our clients, and in the pages and the trust of the international business press.

Recent media quotations for Basil M Karatzas & Karatzas Marine Advisors:

Need help to buy a ship or jet? Credit Suisse looks to lure super-rich            (Reuters, November 6th, 2017)
This Reuters article explores Credit Suisse’s unique approach to shipping whereby only the top and wealthiest names in shipping that are worth of the bank’s prestigious private wealth management service can still obtain loans for commercial ships or a yacht or a jet… Smaller shipping clients of the bank, whether performing or not with their loans, are “encouraged” to take their business elsewhere.

Investment opportunities in shipping could perhaps be the best in over 30 years’ (Splash 24/7, October 17th, 2017)
“The prospects for dry-bulk have not looked so promising in some time now,” Basil Karatzas, a Splash columnist, said. However, Basil Karatzas qualified the statement by adding that “Hopefully the improved prospects for the market will not be another excuse to kill the market in the bud.”

How protectionism sank America’s entire merchant fleet                                            (The Economist, October 5th, 2017)
This year’s hurricane season and Puerto Rico’s predicament brought to the surface the politics and economics of the Jones Act market. Without necessarily taking a position on the matter, Basil Karatzas is quoted in the ever insightful and prestigious The Economist.

Shipping may gain from Mexico grain pain                                                                    (Lloyd’s List, September 22nd, 2017)
Anti-globalization talk is not always bad for shipping; counter-intuitive, but true. Just look at Mexico’s grain imports.

Shipowners Rejoice Over Rising Demand for Commodities                                      (The Wall Street Journal, September 22nd, 2017)
2017 has been good for the dry-bulk shipping industry. Not an exceptional year and actually the threshold was too low given the abysmal market in 2016. However, on the strength of commodities trading and importation, dry-bulk vessels, especially capesize vessels, have seen the market to quintuple.

Global Shipping Trends: China Cosco Buys Orient Overseas                                      (The Diplomat, August 16th, 2017).
An interview with Dr Mercy A Kuo and the esteemed publication The Diplomat, an international affairs magazine for the Asia Pacific.

China underlines shipping ambitions with $6.3bn takeover of HK group                (Financial Times, July 9th, 2017)
Commenting in the Financial Times on state-owned Cosco acquisition of Orient Overseas International (OOIL) in Hong Kong

China’s Cosco to Buy Shipping Rival Orient Overseas for $6.3 Billion                        (The Wall Street Journal, July 9th, 2017)
Commenting in The Wall Street Journal on state-owned Cosco acquisition of Orient Overseas International (OOIL) in Hong Kong

Trying to see through the fog…even from the shore, the sea can look overwhelming… but always a charmer and a generous giver to those who dare… Cape Cod, MA, USA Image credit: Karatzas Images

© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.

IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

Looking at Shipping’s Crystal Ball for 2017

We are pleased to reproduce an article that Karatzas Marine Advisors & Co. was invited to contribute for BMTI’s annual review earlier this year. BMTI is an independent research firm which produces daily and bespoke reports in the dry bulk market with special emphasis for smaller tonnage, MPPs, and other specialty assets. Their website can be accessed by clicking here, please pay them a visit! To read our article, please click on the icon herebelow.

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© 2013 – present Basil M Karatzas & Karatzas Marine Advisors & Co.  All Rights Reserved.


IMPORTANT DISCLAIMER:  Access to this blog signifies the reader’s irrevocable acceptance of this disclaimer. No part of this blog can be reproduced by any means and under any circumstances, whatsoever, in whole or in part, without proper attribution or the consent of the copyright and trademark holders of this website. Whilst every effort has been made to ensure that information here within has been received from sources believed to be reliable and such information is believed to be accurate at the time of publishing, no warranties or assurances whatsoever are made in reference to accuracy or completeness of said information, and no liability whatsoever will be accepted for taking or failing to take any action upon any information contained in any part of this website.  Thank you for the consideration.

pages-from-b-2017jan-02-bmti-report