High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
I met Bob a little over a year ago when we had dinner together at the CMA conference in Stamford, Connecticut. He was unlike anyone I had ever met and was clearly winning the game of life, partly by luck, and partly by pure genius. Our discussion that evening were about questions that very few people ever have a reason to ponder, and I was flattered by his interest in gCaptain.
I left Stamford thinking, “was that guy for real?”
A few months later, I ran into Bob at a bar in Greece and this time it was, “I’m looking to buy a fleet of tankers.”
“Yea me too,” I thought to myself, along with a pegasus, a unicorn and a minotaur.
“Wow, that’s awesome,” I replied.
I took another sip of my beer and tried to think of something else to say, but honestly, my brain had just exploded. Part of me thought, “this guy is totally full of shit,” but I could tell he wasn’t kidding. Bob was playing on a field that opens its gates to very few people in this world.
Almost a year later, Mr. Burke’s plan has been realized in the founding of Ridgebury Tankers, LLC and a $200 million investment from private equity firm, Riverstone Holdings. This new tanker company, led by Burke, is focused on the acquisition and operation of clean product tankers and Suezmax crude carriers.
Burke notes in a statement to reporters that their strategy is “to invest in modern tonnage either currently on the water or on resales of vessels that will enter service shortly.”
“We believe that the next 12-24 months will present an attractive entry point for investment in the sector. Although distressed opportunities may present themselves, our primary focus will be the pursuit of quality modern tonnage. We are not in a rush to invest, and we want to focus our efforts on opportunities with a high certainty of closing. With Riverstone’s equity commitment and sensible financial leverage, we believe we have a great opportunity to build a highly successful company in the tanker sector.”
In addition to Mr. Burke, Ridgebury’s management team includes Kevin Bavolar as CFO, as well as Hew Crooks and Steve Fitzgerald. Messrs. Burke, Bavolar and Fitzgerald worked together at GE Capital, and Mr. Crooks worked with Mr. Burke at Great Circle Capital, a maritime equity investment fund. “In a small organization such as Ridgebury, it is imperative to have a team that has worked together before,” said Mr. Bavolar.
John Lancaster, a Partner at Riverstone added, “This investment is consistent with Riverstone’s model of partnering with proven management in focused strategies in specific segments of the energy industry. Crude oil and product tankers are an essential component of the rapidly evolving and critical global energy logistics system, and we believe the sector’s immediate and long-term fundamentals provide the potential for entry, growth and attractive returns. We are excited to partner with Bob and his team in this new venture.”
With the innovation, talent and well, luck, that Mr. Burke has brought to past pursuits, this should be an interesting one to watch. Best of luck to Mr. Burke and his team.
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