(Oct 28 2011)
Bergen-based parcel tanker owner and operator Odfjell is to manage its entire fleet using Veson Nautical’s IMOS (Integrated Maritime Operations System).
I*n addition, the company will be installing Veslink, Veson's automated system for ship-to-shore communications.
Odfjell’s shipping division - Odfjell Tankers - operates a fleet of about 100 chemical tankers, ranging in size from 4,000 dwt to almost 50,000 dwt.
When Odfjell’s management decided to replace the company’s in-house software system with a fully integrated solution, they short listed companies that could address Odfjell’s biggest ‘pain points.’
The management sought to automate routine tasks, streamline communications between departments, increase productivity and to use real-time voyage data to make the most profitable decisions.
Einar Øye, Odfjell’s senior project manager, explained; “From our first meeting, the Veson team demonstrated an in-depth understanding of our business processes and a holistic and advanced approach to voyage management and software design. That combination was an important factor when we chose Veson.”
John Veson, president of Veson Nautical said; “We are excited that the combination of IMOS and Veslink will bring unprecedented connectivity to the company’s entire operations, from vessels and crew on board, to onshore staff and external service providers.
"The Odfjell team has a sophisticated understanding of how advanced software can help control costs and create profit, and we look forward to a long and productive partnership,” he said.
Odfjell has begun the implementation phase and expects to go live with IMOS by the end of 2012 for the shore based organisation, including about 15 global sites, while Veslink is scheduled to be deployed on board 100 vessels. The company is also integrating IMOS into its corporate accounting package.
Øye concluded; “IMOS and Veslink give us the ability to capture voyage related information at the source and automatically utilise that information throughout our work processes. It’s our goal to provide Odfjell employees with tools which enable them to easily access information relevant to their work. We believe the Veson solution supports this goal and this will be incredibly beneficial for us.”
Friday, 28 October 2011
Wednesday, 26 October 2011
Why do institutional investors stay away from small cap companies?
This is always a question when someone is doing an IPO or other fund raising exercise. This is especially so when they have a very good story to tell but small number of investors turn up. This is always a problem for smaller cap companies. Why?
The reasons is probably as follows:
1. Every investor's appetite is different. An investor with US$200mio of funds on hand would want at least US$5mil of investment to call it sizeable. they do not want to invest in a small company with say market cap of $10mil. Their position will be too significant where they can not get out so easily. That's why certain investor wants to invest in a company with a certain minimum amount of market cap. In the case for smaller company, it should find investor with relatively smaller size and appetite of investment amount and works its way from small cap to mid cap to get the attention of the investors. Some really small cap must concentrate on retail investors only.
2. Every investor has his/her own compliance office. He needs to consult with his/her compliance office and if he fails to do so then the investment will be scrapped no matter how good and potential the project is.
3. Some investors avoid investing in small cap because of their perceived lack of quality of small cap companies. Some of the belief are as follows:
a. lack of transparency of management
b. lack of adequate research by fund houses and brokers
c. lack of financial muscle
d. low liquidity
e. high volatility
The management must work hard to deliver values and continue to comply with the good governance to avoid the above perception. One thing to remember is that many of the larger cap companies nowadays are small cap 10 or 15 years ago.
4. The Company' share is not liquid enough to buy. Investors sometime require that the company would have certain minimum average trading volume so that their entering and exiting strategy would not be so difficult. The company management should continue to deliver liquidity in the market and performing frequent corporate actions which give value to investors.
5. In many cases for small cap, management is too busy concentrating on operation and they can not look after investor relations and proper communication of plans.
just some of my thought today....
Cheers,
SS
The reasons is probably as follows:
1. Every investor's appetite is different. An investor with US$200mio of funds on hand would want at least US$5mil of investment to call it sizeable. they do not want to invest in a small company with say market cap of $10mil. Their position will be too significant where they can not get out so easily. That's why certain investor wants to invest in a company with a certain minimum amount of market cap. In the case for smaller company, it should find investor with relatively smaller size and appetite of investment amount and works its way from small cap to mid cap to get the attention of the investors. Some really small cap must concentrate on retail investors only.
2. Every investor has his/her own compliance office. He needs to consult with his/her compliance office and if he fails to do so then the investment will be scrapped no matter how good and potential the project is.
3. Some investors avoid investing in small cap because of their perceived lack of quality of small cap companies. Some of the belief are as follows:
a. lack of transparency of management
b. lack of adequate research by fund houses and brokers
c. lack of financial muscle
d. low liquidity
e. high volatility
The management must work hard to deliver values and continue to comply with the good governance to avoid the above perception. One thing to remember is that many of the larger cap companies nowadays are small cap 10 or 15 years ago.
4. The Company' share is not liquid enough to buy. Investors sometime require that the company would have certain minimum average trading volume so that their entering and exiting strategy would not be so difficult. The company management should continue to deliver liquidity in the market and performing frequent corporate actions which give value to investors.
5. In many cases for small cap, management is too busy concentrating on operation and they can not look after investor relations and proper communication of plans.
just some of my thought today....
Cheers,
SS
Tuesday, 25 October 2011
Capital Increase Without Pre-emptive Rights IV
Hello All,
We have come to the final discussion on the above topic which will be on the requirement for shareholders approval with regard to the debt to equity conversion and part of the Capital Increase Without Pre-emptive Rights.
Well, as requested under the capital market authority, this kind of transaction is subject to shareholders' approval. The procedure for the EGM is basically the same as in any corporate actions in which EGM Announcement should be done 14 days prior to the EGM Notice and the EGM Notice must be done 14 days prior to the EGM.
One thing to note for the creditor about the debt to equity conversion is about the lock up period. Those creditors that receives the shares in consideration of the debt converted must be subject to a lock up period of 1 (one) year from the moment the shares are listed on the exchange. This is regulated under the Exchange and intended to mitigate sudden significant decline in the share price of such company following the provision of the shares to creditors especially considering the size of the shares issued which at times can be substantial and more than the existing shares. For example: the debt to equity conversion conducted by Langgeng Makmur Industry and Sekar Laut in 2005 where the shares outstanding in the market suddenly increase by 91% and 814% due to such undertaking. On the debt to equity conversion by Surabaya Agung in 2007 the outstanding shares increased by close to 1,100% from the existing outstanding shares.
Okay now. Seems we have covered some issues on the debt to equity conversion. lets see if we can discuss other more interesting matters in the coming weeks.
Chao....
SS
We have come to the final discussion on the above topic which will be on the requirement for shareholders approval with regard to the debt to equity conversion and part of the Capital Increase Without Pre-emptive Rights.
Well, as requested under the capital market authority, this kind of transaction is subject to shareholders' approval. The procedure for the EGM is basically the same as in any corporate actions in which EGM Announcement should be done 14 days prior to the EGM Notice and the EGM Notice must be done 14 days prior to the EGM.
One thing to note for the creditor about the debt to equity conversion is about the lock up period. Those creditors that receives the shares in consideration of the debt converted must be subject to a lock up period of 1 (one) year from the moment the shares are listed on the exchange. This is regulated under the Exchange and intended to mitigate sudden significant decline in the share price of such company following the provision of the shares to creditors especially considering the size of the shares issued which at times can be substantial and more than the existing shares. For example: the debt to equity conversion conducted by Langgeng Makmur Industry and Sekar Laut in 2005 where the shares outstanding in the market suddenly increase by 91% and 814% due to such undertaking. On the debt to equity conversion by Surabaya Agung in 2007 the outstanding shares increased by close to 1,100% from the existing outstanding shares.
Okay now. Seems we have covered some issues on the debt to equity conversion. lets see if we can discuss other more interesting matters in the coming weeks.
Chao....
SS
Friday, 21 October 2011
Ocean Tankers' in Difficulty
Ocean Tankers' assets go under the hammer(Oct 21 2011)
Another vessel operated by Cyprus-based Ocean Tankers and managed by Admibros is to be auctioned.
According to Lloyd’s List, the 1998-built 15,558 dwt chemical tanker ‘Anefani’ is to go under the hammer before the Rotterdam district court on November 22, on an ‘as is, where is’ basis, at the request of Royal Bank of Scotland, Dutch law firm AKD Prinsen van Wijmen confirmed to the daily shipping newspaper.
It was thought that the crew claimed nearly $200,000 on back wages, leading to a judgement to sell the vessel.
Earlier this week, the UK Admiralty Marshall opened bidding on the 1997-built, 15,885 dwt sister vessel ‘Frachtis’, currently lying off Falmouth, which had also been arrested.
Towards the end of last month, Lloyd’s List established that 1999-built, 14,441 dwt ‘Skledros’ and her sistership ‘Hartzi’ were being held off Skagen. The 2007 -built, 4,285 dwt ‘Marim’ was also being held in Rotterdam, while the 1999-built, 19,831 dwt ‘Eleousa Trikoukiotisa’ was lying in Ghent.
In addition, the 2001-built, 19,831 dwt, ‘Berengaria’ was alongside Gibraltar’s detached mole awaiting her fate, during Tanker Operator’s visit to the Rock last week.
Taken from Tanker Operator
www.chemicaltankers.blogspot.com
Another vessel operated by Cyprus-based Ocean Tankers and managed by Admibros is to be auctioned.
According to Lloyd’s List, the 1998-built 15,558 dwt chemical tanker ‘Anefani’ is to go under the hammer before the Rotterdam district court on November 22, on an ‘as is, where is’ basis, at the request of Royal Bank of Scotland, Dutch law firm AKD Prinsen van Wijmen confirmed to the daily shipping newspaper.
It was thought that the crew claimed nearly $200,000 on back wages, leading to a judgement to sell the vessel.
Earlier this week, the UK Admiralty Marshall opened bidding on the 1997-built, 15,885 dwt sister vessel ‘Frachtis’, currently lying off Falmouth, which had also been arrested.
Towards the end of last month, Lloyd’s List established that 1999-built, 14,441 dwt ‘Skledros’ and her sistership ‘Hartzi’ were being held off Skagen. The 2007 -built, 4,285 dwt ‘Marim’ was also being held in Rotterdam, while the 1999-built, 19,831 dwt ‘Eleousa Trikoukiotisa’ was lying in Ghent.
In addition, the 2001-built, 19,831 dwt, ‘Berengaria’ was alongside Gibraltar’s detached mole awaiting her fate, during Tanker Operator’s visit to the Rock last week.
Taken from Tanker Operator
www.chemicaltankers.blogspot.com
Saga Tankers pushes the exit button
Saga Tankers pushes the exit button(Oct 21 2011)
Saga Tankers is to withdraw from shipping and sell its remaining VLCCs.
A proposal to cease shipping operations will be put to an extraordinary general meeting to be held on 10th November.
Saga Tankers has already agreed the sale of the VLCCs ‘Saga Julie’ and ‘Saga Agnes’ (built 2000) to Greek interests for $30.5 mill net each. The sale of the ‘Saga Julie’ is outright and free from any subjects, while the sale of the ‘Saga Agnes’ is subject to approval of Saga Tankers’ general meeting.
The full sales proceeds from both vessels, plus the value of bunkers and lubes, will be used to deleverage the company. The first vessel will be delivered to the buyer during November 2011, while the second will be delivered upon completion of her timecharter in July/August 2012.
The buyer will lodge a deposit of 15% of the sales price in a joint account until the vessel is delivered.
As a result, Saga Tankers will make an extraordinary repayment under its loan facility of $13 mill. Following the sale of the vessels and repayments of the loan, total outstanding debt under the company's loan facility will be $21 mill attributable to the company's remaining VLCC, ‘Saga Agnes’.
The loan will be amortised by $1.2 mill per quarter until delivery in July/August 2012.
In the third quarter 2011 financial report, the company said that it will make a write down on the book value of ‘Saga Julie’ of $27.5 mill following the sale, and the same amount following the forward sale of ‘Saga Agnes’.
The sale of ‘Saga Unity’, reported in Tanker Operator news of 17th October, will result in a write down of $28.6 mill.
Saga Tankers said that the steps taken following the decline in ship values saved the company from breaching financial covenants under its loan agreement. As a result, the company is no longer in discussions with its lenders over its debts.
The board said that it unanimously recommended the general meeting to approve the sale of ‘Saga Agnes’. Following the sale, the company will no longer be involved in shipping.
The sale will only be completed if two thirds of the votes cast are in favour of the proposal, the company pointed out.
Following the completion of a potential sale of the vessel ‘Saga Agnes’, the board said that it will make proposals regarding the company's future business and operations.
This may relate to the development of a new strategy, a change of the description of the business in the articles of association since it will no longer be engaged in the shipping business, or possibly dissolve the company and consequently pay out shareholder values as a dividend.
Saga Tankers is to withdraw from shipping and sell its remaining VLCCs.
A proposal to cease shipping operations will be put to an extraordinary general meeting to be held on 10th November.
Saga Tankers has already agreed the sale of the VLCCs ‘Saga Julie’ and ‘Saga Agnes’ (built 2000) to Greek interests for $30.5 mill net each. The sale of the ‘Saga Julie’ is outright and free from any subjects, while the sale of the ‘Saga Agnes’ is subject to approval of Saga Tankers’ general meeting.
The full sales proceeds from both vessels, plus the value of bunkers and lubes, will be used to deleverage the company. The first vessel will be delivered to the buyer during November 2011, while the second will be delivered upon completion of her timecharter in July/August 2012.
The buyer will lodge a deposit of 15% of the sales price in a joint account until the vessel is delivered.
As a result, Saga Tankers will make an extraordinary repayment under its loan facility of $13 mill. Following the sale of the vessels and repayments of the loan, total outstanding debt under the company's loan facility will be $21 mill attributable to the company's remaining VLCC, ‘Saga Agnes’.
The loan will be amortised by $1.2 mill per quarter until delivery in July/August 2012.
In the third quarter 2011 financial report, the company said that it will make a write down on the book value of ‘Saga Julie’ of $27.5 mill following the sale, and the same amount following the forward sale of ‘Saga Agnes’.
The sale of ‘Saga Unity’, reported in Tanker Operator news of 17th October, will result in a write down of $28.6 mill.
Saga Tankers said that the steps taken following the decline in ship values saved the company from breaching financial covenants under its loan agreement. As a result, the company is no longer in discussions with its lenders over its debts.
The board said that it unanimously recommended the general meeting to approve the sale of ‘Saga Agnes’. Following the sale, the company will no longer be involved in shipping.
The sale will only be completed if two thirds of the votes cast are in favour of the proposal, the company pointed out.
Following the completion of a potential sale of the vessel ‘Saga Agnes’, the board said that it will make proposals regarding the company's future business and operations.
This may relate to the development of a new strategy, a change of the description of the business in the articles of association since it will no longer be engaged in the shipping business, or possibly dissolve the company and consequently pay out shareholder values as a dividend.
Thursday, 20 October 2011
Capital Increase Without Pre-emptive Rights III
Okay, in the previous discussion we have covered the two criteria for an eligible debt to equity conversion being part of the Capital Increase Without Pre-emptive Rights. One being the type of company that is allowed to do the debt to equity conversion, second is the type of debt that can be converted and as to whether the interest, coupon and penalty from the debt is part of the amount eligible for conversion.
Now in this session, I am going to cover the determinant for the conversion price.
One thing to also note in the debt to equity conversion when performing this capital increase without pre-emptive rights is to consider how much debt that can be converted into share and by how many shares. The debtor has the interest of making sure his money worth as many shares as possible while the creditor prefers to part way with as little shares as possible. The good news is, there is a mechanism to address this.
The other thing to consider is the share price of the company. In any typical scenario, normally the share price of this kind of company is pretty low and as one can imagine, the lower the share price of such public company, the more shares the creditor have to forgo its shares to the party it owes to in order to pay down the debt. This in turn will result in higher dilution effect to the other existing shareholders.
Due to this dilution effect and in order to mitigate minority shareholders being unnecessarily worse off due to the conversion as well as to regulate the conversion mechanism, poin V.1.1 of IDX Rule No. 1-A stipulates that the conversion price must not be lower than the average 25 days of the share price in the stock market before the EGM is conducted.
On the conversion price, we also need to note whats the Corporate Law has to say about it. Article 33 of the prevailing rule says that the share issuance for the paid-in capital of a company must be paid in full amount. With such requirement that the share issuance must be paid in full, then it requires both parties to make sure that the conversion is done at least equal to the nominal value of the share as stated in the company's article of association. From here, we can conclude that the conversion price must be either the average share price of 25 days prior to the EGM or the nominal value of the share whichever is higher. If it happens that the average 25 day share price is lower than the nominal value of the share, then we should use the nominal value.
thats all for now, folks! be back with another topic which is the shareholders' approval for this corporate action.
Cheers
SS
Now in this session, I am going to cover the determinant for the conversion price.
One thing to also note in the debt to equity conversion when performing this capital increase without pre-emptive rights is to consider how much debt that can be converted into share and by how many shares. The debtor has the interest of making sure his money worth as many shares as possible while the creditor prefers to part way with as little shares as possible. The good news is, there is a mechanism to address this.
The other thing to consider is the share price of the company. In any typical scenario, normally the share price of this kind of company is pretty low and as one can imagine, the lower the share price of such public company, the more shares the creditor have to forgo its shares to the party it owes to in order to pay down the debt. This in turn will result in higher dilution effect to the other existing shareholders.
Due to this dilution effect and in order to mitigate minority shareholders being unnecessarily worse off due to the conversion as well as to regulate the conversion mechanism, poin V.1.1 of IDX Rule No. 1-A stipulates that the conversion price must not be lower than the average 25 days of the share price in the stock market before the EGM is conducted.
On the conversion price, we also need to note whats the Corporate Law has to say about it. Article 33 of the prevailing rule says that the share issuance for the paid-in capital of a company must be paid in full amount. With such requirement that the share issuance must be paid in full, then it requires both parties to make sure that the conversion is done at least equal to the nominal value of the share as stated in the company's article of association. From here, we can conclude that the conversion price must be either the average share price of 25 days prior to the EGM or the nominal value of the share whichever is higher. If it happens that the average 25 day share price is lower than the nominal value of the share, then we should use the nominal value.
thats all for now, folks! be back with another topic which is the shareholders' approval for this corporate action.
Cheers
SS
Tuesday, 18 October 2011
Ending Greece Crisis
Since we have been discussing about debt to equity conversion as part of Capital Increase Without Pre-emptive Rights, I come to realize that world can end Greece problem using the debt to equity conversion instead of providing aid or some other form of assistance. Greece debt is so huge and it may take forever to repay them all. And by the way, the longer we wait the deeper and wider the problem and it is not going to be good for everyone. Sigh!
Cheers
SS
Cheers
SS
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