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KARATZAS MARINE ADVISORS & Co.
Case studies where our firm was involved with transactions and the disposition of assets on behalf of financial owners demonstrate the level of expertise, skill and dedication can be committed in flawless strategy and execution and obtaining exceptional results usually outperforming prevailing market conditions.
CASE STUDY 1: AMERICAN FLAG
A well-known, US-based and publicly traded company, as lessee and charterer of a vessel, makes a very low purchase offer to acquire the vessel from the lessor at the end of the lease.
The lessor is the equipment finance division of a 'Fortune 20' U.S. bank.
The asset is a dry bulk vessel flying the US-flag but built in Japan (an 'American flag' vessel but not 'Jones Act' vessel technically speaking) has primarily been traded under the Cargo Preference Act. The vessel had been exceptionally well maintained, but there have been no market comparable transactions for several years prior.
At the exclusive mandate of our client, the lessor of the vessel, the vessel was marketed to US-based and also foreign buyers; about twenty parties expressed interest in the acquisition of the vessel, and about ten parties inspected the vessel in drydock. After running a very competitive auction-type sale, the sale price achieved was almost twice the price offered by the lessee originally, and about 30% higher than the lessors accounting basis.
CASE STUDY 2: CONTAINERSHIPS
An international, major containership liner company had entered into a sale & leaseback transaction for eight sistership containership vessels with three US-based lessing companies. The lessee decides to re-deliver all eight vessels to the lessors much sooner than the lease expiration based on a 'technological obsolescence' clause in the charterparty.
Our client is one of the three lessors with claim to five of the eight containership vessels. Our client is the equipment finance arm of a brand-name American bank and Fortune 10 company.
At the exclusive mandate of our client, we provided maritime advisory, operational expertise and ship brokerage services, and sold smoothly all five vessels in one en bloc deal at a price that achieved 37.50% premium over the sale of the remaining three vessels from the prior week - the vessels returned to the other two lessors who opted to sell the vessels through a different 'broker channel'.
CASE STUDY 3: GERMAN BANK
A KG house in Hamburg had defaulted on the shipping mortgages of two Japanese-built dry bulk panamax vessels to a major German shipping bank. The bank decided to sell the vessels in the open market.
At the 'joint exclusive mandate' of our client, this major German shipping bank in their capacity as creditors, we marketed the vessels for sale in the secondary market. Shortly thereafter, we sourced the sale of the vessels in an en bloc transaction to a private owner who paid wholly in equity for the transaction.
The sale price achieved was about $750,000 per vessel above prevailing market conditions and approximately 15% above the bank's accounting basis. Besides the superior price achieved, it is noteworthy that the transaction turned out to be very smooth despite the weakening freight and asset price prevailing trend at the time of the sale, the high sale price achieved and the forward delivery of the vessel.
CASE STUDY 4: DEMOLITION SALE & TURN-KEY SOLUTIONS
The Commercial Asset Finance Division of a major US-based insurance company was the creditor to a US-based leasing company for the acquisition of an aframax tanker. When the charterer for a long term timecharter defaulted on the charter, the lessor defaulted on the creditor. Given the weakness of the freight market, the vessel was placed in 'cold lay-up' in Labuan, Federal Territory in East Malaysia.
At the exclusive mandate of our client, the creditor in the transaction, our firm marketed the vessel for sale in the secondary market either as a 'trading candidate' or a 'conversion candidate' to a Floating Storage Off-loading (FSO) vessel. Due to the weakness of the freight market and the vintage and age of the vessel, the vessel was sold for demolition. Most 'cash buyers' worldwide expressed interest in the vessel and eight of them inspected the vessel after our firm's strong marketing efforts. Besides ship brokerage, our firm offered full 'turn key' services including coordinating with vessel managers, agents, manning companies, authorities and buyers.
In order to maximize the sale price, the vessel was 're-activated' from her 'cold lay-up' condition and eventually was sold on 'as is, where is' basis in order to minimize operational and transactional risk. The price achieved was 20% above prevailing market condistions, DESPITE the fact the vessel was sold on 'as is, where is' basis.
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