With a lack of capacity in a number of shipping sectors, there is a good case for shipowners to keep adding tonnage via second-hand purchases or newbuilding projects[ds_preview], says Christian Zachariassen, managing director of shipbroking house Andreas J. Zachariassen. However, competition is fierce, hence quick decision-making will be key this year.
With hindsight, what were the best S&P-transactions over the last year, what were the worst?
Christian Zachariassen: Of course all deals done via us were the best! Jokes aside, in terms of purchasing, all deals done in the container and MPP sectors were extremely good as the market has continually risen over the last 1.5 to 2 years. Consequently, I would call most selling deals »less good«, but I would strongly condemn the use of »worse« transactions as selling in a rising market and turning over profits is never a bad thing. On a concrete note, it brings to mind the purchase by my former company Leonhardt & Blumberg, where I did my apprenticeship as a young man, of two Aker 1,700 TEU vessels built 2008 for a rather low price as a prime example of timing and courage.
What kind of opportunities do you expect this year? Anything left or emerging?
Zachariassen: Sure, there are many opportunities left for owners. However, these will be more challenging. First and foremost, major liner companies have emerged as the premier buyers of container and MPP tonnage and new opportunities might come by with less upside potential, due to higher initial investments, technological uncertainties, and perhaps longer remaining time charters on the vessels. But those who boldly order new tonnage, which the market will surely devour, will reap the benefits.
Will German buyers play a bigger role as buyers as balance sheets get strengthened again? How are your local clients doing?
Zachariassen: Bigger role, we would probably say a clear »maybe«, as there are simply fewer owners than in the past. However, I do see that role being more significant for our owners. With strengthened financial stability and thus greater autonomy, owners have achieved what is now required, the ability to execute deals quickly in this highly competitive environment. I therefore expect more deals to be done here, maybe not so much on the second-hand buying market, but rather on newbuildings and branching out into other sectors.
Interview: Michael Hollmann
