– High dividends – Shipping academy is the next step
Ocean Tankers Holdings Public Co. will be the first ocean-going shipping company to go public on the Cyprus Stock Exchange later this summer, after the Nicosia bourse failed to attract the flotations of three other Cypriot-owned shipping companies.
Stelios Haji-Ioannou’s Stelmar, Charalambos Mylonas’ Transmed and the Mouskas family’s Zela Shipping were all companies that took a stab at the island’s exchange and gave up as the CSE authorities deliberated endlessly about the criteria for listing.
“It will be a hot summer and I want the strategic investors, other shipowners as well as the small investors to participate in the flotation,” the company’s confident chief principal Michael Ioannides told the Financial Mirror.
The Ocean Tankers initial public offering (IPO) of approximately USD 15 mln, representing 30% of the company after the flotation, is expected to take place during the next two months as Ioannides embarks on a pre-marketing road show where he will announce novel ways to protect shareholder interest.
The funds raised from the listing will be used to expand the fleet with new tankers as Ioannides stays ahead of the competition and builds up his fleet of double-hull tankers.
Ocean Tankers presently has three vessels in its fleet — the 8,000 dwt Victor, the new Chinese-built 7,600 dwt Timi and the 4,500 dwt Eleousa Trikoukiotisa, built in 2000.
“As the European Union and the U.S. ports are no longer allowing the single-hull tankers to enter their ports, the demand for double-hull tankers is growing steadily,” he explained.
“BP recently announced that it will no longer charter single-hull ships, which still represent some 80% of the worldwide tanker fleet,” Ioannides said, adding that many shipowners will need five or six years to get rid of their single hulls.
“I am already two steps ahead of the rest as I look for what others dare not risk venturing into,” he told the Financial Mirror.
Prospects look good
Given the forthcoming common trading platform between the CSE and the Athens Stock Exchange (ASE), the prospects for Ocean Tankers look good as it will be the only ocean-going stock. All other companies have passenger and cargo ships.
Ioannides said that the prospects are “great”, as he brings with him the experience of running his family-owned Admibros ship-management company, while Ocean Tankers is endowed with favourable contracts with a steadily growing demand and a steady profitability.
He added that 90% of all crude shipments are transported by sea which is by far the most economical way. Some even estimate tankers as costing up to 20 times less than pipelines.
“This will allow us to introduce a dividend-paying policy based on a very high return. I am sure this will also help revive interest in shipping companies, but also in investing on the stock exchange as well.”
Building up infrastructure
Ioannides told the Financial Mirror that once he has caught the interest of the shipowners, he will focus his efforts on ways to prepare the next generation of managers, engineers and shipping experts.
“When the market has matured enough, our next step will be to establish a maritime academy,” he said, speaking in his capacity as president of the Cyprus Marine Club, a non-profit cultural and education organisation.
“In ancient times, Cyprus used to have sea lords. Nowadays, we have modern shipowners, but we don’t have the next generation of Cypriot managers and all the ranks going down to communications and crew.”
Ioannides has already been successful in merging three shipowners’ associations into the present-day Cyprus Union of Shipowners of which he is deputy president. He is also considered as the driving force in pushing for the establishment of the Cyprus Chamber of Shipping, a public service organisation that would encompass all professional and shipping-related associations.
