US Bans Imports From Chinese Fishing Company Citing Seafarer Welfare
By David Lawder (Reuters) – U.S. Customs and Border Protection on Friday imposed a new import ban on seafood from a Chinese fishing fleet that the agency says is using...
Frontline 2012 signed a heads of agreement (HOA) today with Stolt-Nielsen Limited (Oslo BÃ¸rs: SNI) whereby Frontline 2012 will become a shareholder in Avance Gas Holding Ltd (AGHL), an entity jointly owned by Stolt-Nielsen Gas and Sungas Holdings. Following the expected transaction, the three owners will exercise equal control over AGHL, a holding company centered around the growing LPG shipping sector.
As part of the HOA, AGHL will likely end up purchasing the eight 83,000 cbm VLGC newbuildings ordered by Frontline 2012 from Jiangnan Changxing Shipyard in China. Deliveries expected between mid 2014 and the end of 2015.
Once this deal is finalized, Stolt-Nielsen and their partners plan on moving forward with bringing this new company to market as a pure-play on the LPG sector.
Niels G. Stolt-Nielsen, Chief Executive Officer of Stolt-Nielsen Ltd comments,
“The acquisition of shares in AGHL by Frontline 2012 is a further step in AGHL’s consolidation strategy of the VLGC market. With three strong owners, it is the company’s plan to continue to focus on second-hand tonnage, mergers and acquisitions. With rising US exports of LPG from shale gas resources and with continued growth in LPG exports from the Middle East and West Africa, the dynamics of this transportation market are improving in line with our expectations. It is the owners’ plan to do an OTC listing in Oslo followed by an IPO.”
It’s a good deal according to Frontline 2012 Chairman John Fredriksen who comments, “We will get immediate market exposure to what today is a healthy freight market. With its existing six modern VLGCs, a solid operation, and strong owners, Avance Gas is well positioned to grow and act as a major consolidator in the large LPG market.”
Harry Vafias, CEO of Stealth Gas, will still be leading the charge in the LPG sector however. His company has a current fleet of 33 LPG ships and has gained approximately $190 million in funding this year for 9 additional newbuilds. In his company’s 2nd quarter earnings report released this week, Vafias notes that his company “is in advanced discussions with banks” to finance the acquisition of an additional 6 ships by the end of 2015.
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