TURNING POINTS

According to my wife “life is short so eat dessert first.” This philosophy, while often puzzling to wait-staff, epitomizes a philosophy to which I now subscribe. It boils down to three words: good news first. So here it is: Tsakos Energy Navigation issued 6.5 million shares at $15 apiece and the deal marked a turning point in capital markets ship finance.

I don’t mean to be dramatic, but the Tsakos deal really is very meaningful. First, it clears up any lingering question of whether the US Capital markets are willing to finally forgive and forget failed high yield deals. Second, the TEN deal is an example of the fact that investors view a shipowners’ long-term employment profile as being just as important as owning lots of ships in the same size category. This means that for companies with a basket of charters, the IPO “window” may not be as tough to squeeze through as otherwise thought. Finally, while currently fully priced realtive to its peers, the TEN IPO was sold into a weak tanker market and therefore has the potential to spawn a class of professional investors that will make money in shipping on their first go. Lest anyone underestimate the goodwill generated by Stelmar, a top performing IPO in 2001.

This is only an excerpt of TURNING POINTS

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