2007

Marinakis Returns

Despite concerns that the multitude of shipping IPOs in 2004 and 2005 would ultimately turn investors away from shipping just as the high yield bond issues of the late 90s did, almost the opposite has happened. In March of 2007, there are more public shipping companies than ever before, with new ones coming to market faster than old ones can be bought up or consolidated. The IPO frenzy of 2004 ultimately, though not gracefully, educated a world if investors about shipping and world of shipowners about public investors. Investment bankers faced over and over with the fundamentals of the various shipping sectors meanwhile began to dream up more creative ways of packaging the industry attractively for investors.

If there is anyone who epitomizes this process, it is Evangelos Marinakis of Capital Maritime. With a history as a successful shipowner in the Greek tradition, Mr. Marinakis first attempted to sell his company to investors in New York in the spring and summer of 2005. He and his team probably saw their company as very saleable – with experienced management, a strong track record, diversified assets, a competent in-house management team, and investment in newbuildings for future growth in the promising product tanker sector. Not surprisingly, they were somewhat disappointed with the lukewarm reception they received from investors. Confident that his company was worth more than the price these investors were willing to pay, Mr. Marinakis withdrew his initial deal and stepped back from the frenzied New York capital markets.

This is only an excerpt of Equity – 03/22/2007

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