- As Navios Maritime Acquisition Sees Rise in Profit
Financially troubled South Korean shipping company Hyundai Merchant Marine (HMM) has failed to seal a deal with ship owners on charter rate cuts, Yonhap reports, citing company officials.
The talks were launched in February and the company was optimistic on reaching the deal as it had reportedly managed to agree on cuts with 60 percent of owners. Under the plan, ship owners were requested to lower their charter rates by 28 percent on average by the middle of May, according to Yonhap.
This exerts further pressure on the struggling company which counted on the rate reductions as one of the key preconditions for the company to move forward with its restructuring process and thus avoid going bankrupt.
However, the talks between the two parties are not completely over and their might be still some room for an agreement.
Last month, HMM and state-owned Korea Development Bank (KDB) concluded a debt-for-equity swap arrangement, which will see KDB take 30 % of shares in total and the rest of the creditors will take 50% in shares in the company.
The move is expected to keep the company afloat until it completes its business normalization plan.
The company closed the first quarter of the year with an operating loss of KRW 162.9 billion (USD 139 million) and a net loss dived of KRW 276.1 billion.
Meanwhile, NYSE-listed tanker company Navios Maritime Acquisition has reported its net income at USD 23.8 million, an increase of 19 percent in for the first quarter of 2016, against the USD 20 million recorded in the same period a year earlier.
The company said that the increase is mainly attributed to the gain on sale of the Nave Lucida and a rise of USD 1.9 million in adjusted EBITDA.
Revenue for the period was up by 2.3 percent to USD 80.4 million, against USD 78.6 million for the same period in 2015, mainly attributed to the rise in revenue following deliveries of four vessels from January 2015 until March 31, 2016.
Navios Acquisition fixed the fees of its vessels under its existing management agreement with Navios Tankers Management Inc., a wholly-owned subsidiary of Navios Maritime Holdings Inc., for an additional two-year period from May 29, 2016, following the expiration of the current fixed fee period, until May 28, 2018.
The company’s MR2 product tanker and chemical tanker vessels were fixed at a daily fee of USD 6,350 per vessel, while LR1 product tankers and VLCCs were fixed at USD 7,150 and USD 9,500 per ship, respectively.
The increase represents a weighted average increase of 3% in the management fees of the fleet.
“Navios Acquisition continues to harness the economies of scale created by Navios Holdings. Under the arrangement, Navios Holdings provides Navios Acquisition technical and commercial management services for a fixed fee and administrative services at cost,” Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition, said.
During the quarter, Navios Acquisition sold its 2005-built MR2 product tanker Nave Lucida for USD 18.6 million, and in April 2016, the company agreed to sell the Nave Constellation, a 2013-built chemical tanker of 45,281 dwt, and the Nave Universe, a 2013-built chemical tanker of 45,513 dwt, for an aggregate of USD 74.6 million.
The vessels are expected to be sold in the third quarter of 2016, following the completion of their chartering commitments, expected in the third quarter of 2016.
Navios Acquisition currently owns 38 vessels of which eight are VLCCs, 26 are product tankers and four are chemical tankers.
World Maritime News
