It was going to be the Singapore answer to the KG Fund. An idea, with the benefit of hindsight, that was not nearly as good as it sounded given how much trouble KG Funds would themselves be in within a few years, following the collapse of global shipping and financial markets.
Despite all the excitement that shipping trusts generated only three were ever listed on the Singapore Exchange: Rickmers Maritime, Pacific Shipping Trust (PST) and First Ship Lease (FSL) Trust.
Today PST has successfully delisted itself and Rickmers Maritime after a major restructuring seems to be getting back on track after a rights issue but is still very limited in what it can do investment wise.
That left FSL Trust, which up until around 2011 still seemed to have a decent story to tell. It had a diversified portfolio of assets with sale and leaseback deals across some good names in the industry. Unfortunately those good names were not as solid as all may have expected, including the likes of Torm and Berlian Laju Tanker. The company’s latest default was in June from Geden Lines and it was clear things were not good.
Largely unnoticed in the wider market at the time, in June a restructuring specialist was brought onto the board along with a well renowned Singapore-based finance lawyer. Last Thursday saw the trust’s senior management quit en masse. Whether restructuring is the next phase for FSL Trust remains to be seen.
Meanwhile the once exciting model of a listed shipping trust proffering a sale and leaseback deal to owners looks likely to be consigned to history as a failed experiment, hit by bad markets and lack of investor interest.
Today the big noise in shipping finance is private equity, which is certainly a different experience for the freewheeling, individual personality driven shipping industry shall we say.
Copyright © 2024. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited. Add Seatrade Maritime News to your Google News feed.
