As a large, but relatively conservative shipowner, the generally low markets and values seen across various sectors in the industry, would seem to have suited BW as an investor.
“We do try to be a bit more cautious when the market is high,” Sohmen-Pao says.
“It continues to be a difficult market to read accurately. Generally speaking we have preferred to buy when asset prices are cheaper and take the pain of low income for a while. In an ideal world one would be able to invest at 11-59 just before a market turns.”
A very good example of this strategy is BW Dry founded in April 2016 and targeting vessels in the 50,000 – 90,000 dwt range.
“We saw an opportunity to acquire vessels at attractive prices knowing that the returns would likely be subdued for some time, but feeling we were buying good quality assets with a long life and feeling we could benefit from a cyclical recovery at some stage,” he explains.
The choice of the 50,000 – 90,000 dwt delineates BW Dry from Berge Bulk run by Sohmen Pao’s brother-in-law James Marshall, which operates a fleet of over 50 bulkers mainly in the capesize and very large ore carrier sectors, although it also has some handysize vessels.
“Our ambitions are very modest in the sector and it is more of a opportunistic play,” Sohmen-Pao comments.
To read the full interview, download the Seatrade Maritime Singapore Report 2017:
Andreas Sohmen-Pao will be chairing the Sea Asia Parliamentary Debate on ‘This House believes that the best days of the private independent shipowner are over’ at Sea Asia 2017