ClassNK Announces American Acquisition, Seeks Brown Water Footprint

Safety Management Systems’ Director, Project Strategy William Mahoney and Noboru Ueda, Chairman and President of ClassNK. Image: ClassNK

STAMFORD – For the first time in their 113-year history, Tokyo-based classification society ClassNK has announced growth via acquisition.

At the Connecticut Maritime Association Shipping 2013 Conference, ClassNK and Portland, Maine -based Safety Management Systems, LLC (SMS) announced they have merged their respective businesses.

As their name suggests, SMS is a safety management consultancy focused on the maritime industry which has earned a strong reputation since its founding in 1996.  The company is perhaps most notable for having been chosen by the New York Department of Transportation to assist the Staten Island Ferry to develop a world class safety management system following a fatal accident in 2003. Today, SMSLLC clients include a diverse range of U.S. commercial and public operators managing domestic and foreign flagged vessels.

ClassNK Chairman and President Noboru Ueda announced the acquisition during a press conference at the Connecticut Maritime Association’s Shipping 2013 exhibition. “Until now, ClassNK has focused primarily on the certification of safety management systems, but it is the development and implementation of safety management systems where owners face the most challenges and can secure the greatest benefits. With the acquisition of SMSLLC, we can now offer inland, coastal, offshore, and ocean going vessel owners full support throughout the safety management process.”

Bill Mahoney, Director of SMSLLC added: “We’ve worked alongside ClassNK for many years, and we greatly respect each other as leaders in our respective fields. With this new partnership we will be able to combine our expertise and reputation in the U.S. shipping industry with the resources and support of the world’s largest classification society. This is a partnership that will allow us to expand out services, not just for the benefit of our clients, but for the benefit of the entire U.S. maritime sector.”

Background

Recent legislation passed by the US government has opened the doors to ClassNK to provide safety management certificates to vessels operating within the Great lakes region and on rivers of the United States, an area which has previously been the exclusive realm for the American Bureau of Shipping.

According to industry sources, tugs and barges on the Mississippi and other rivers transport 20% of U.S. coal and 60% of U.S. grain exports, making the sector an important component of international maritime trade. This point was highlighted by ClassNK Executive Vice President Yasushi Nakamura, who stated: “The brown water industry is not just essential to the maritime industry here in the U.S., it is essential to the world maritime industry. As we classify more than 35% of the world’s bulk carriers, a significant portion of U.S. grain and coal are transported on NK classed vessels, so we know this first hand.”

Mr. Nakamura also noted the benefits of safety management, and its potential to help the industry as it adjusts to new regulations: “Safety management is an important tool that can help owners and operators greatly reduce accidents caused by human error. ClassNK helped develop the ISM Code, and we are the world’s leading provider of ISM certification, and we believe our experience with ISM globally will contribute to the safety of the brown water industry, as well.”

With a 50 year history of working in the United States since first opening their New York office in 1962, ClassNK has expanded their business and opened offices in many of the top shipping ports in the United States.

SMS’ goal is to reduce the challenge of compliance for operators for brown water operators while at the same time give these companies another option when it comes to safety management compliance.  SMS’ role will be through the development and implementation of such plans, and ClassNK will be the certification body.

“With over 5,000 vessels, the US brown water market is large enough for more than one class society.  This region is essential to the growth of the world’s maritime industry” says Noboru Ueda, Chairman and President of ClassNK.