Seatrade Maritime is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Live From Posidonia 2014
6cafeb893daa3572494ff59f9b9dcc50_XL

Shipowners ‘abusing’ US Chapter 11 charges Euronav chief Rodgers

Euronav ceo Paddy Rodgers launched a stinging attack on what he called the “abuse” of Chapter 11 bankruptcy protection procedures in the US by shipping companies.

Speaking at the Tradewinds Shipowners Forum at Posidonia 2014 Rodgers said the Chapter 11 which was designed to protect major US employers and the economy was being abused by shipping which is a people light and capital intensive business, leading to a destruction of the competitive environment.

“Chapter 11 is being misused to destroy capital and allow competitiveness to succeed at levels that unsupportable even return of debt to banks unsupportable,” he charged.

Rodgers cited the example of New York-listed Overseas Shipholding Group (OSG), which filed for Chapter 11 in November 2012.

“So our partners in business OSG went bankrupt and for two years in the worst market didn’t even have to pay their operating expenses. How can we compete with that? Where’s the advantage to us? That is a recipe that drives the road to hell.

“We’re being shafted by the market and the way the vetting system works, and shipowners who aren’t competitive and who don’t have the edge get protection from the courts and write off capital hugely at expense of the banks and the shareholders,” he stated to spontaneous applause from the audience.

As the industry seeks billions in new capital for scrubbers and other innovations he questioned where the money would come from when the previous round of newbuildings had not even been paid for.

“I don’t know where you think you’re going to get capital for new ships because you haven’t paid for what you ordered 10 years ago.”

 

Hide comments
account-default-image

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish
Maritime_Market_User_Promo_4
Find suppliers online

Connecting shipping executives directly to trusted suppliers 24/7, giving year-round access to an extensive database of maritime professionals from Informa Market’s world-leading maritime events and media which include: Marintec China; Seatrade Maritime Middle East; Sea Asia; Sea Japan and Inmex India, amongst others.

Maritime_Market_User_Promo_4