Why Cash (Flow) Was King in 2004

As I sit down to write this issue, surrounded by about 100 pages of Excel sheets containing details on hundreds of ship finance transactions, I am truly in awe of the scale and scope of the deals completed in the last 12 months. There were so many deals done that our analysis will comprise two issues. The year 2004 saw about $40 billion of debt deals, $20 billion of mergers & acquisitions, $8 billion of bonds and $6 billion of leases. All tolled, about $74 billion of capital was formed for shipping deals. Shipping financiers arranged $202 million every day during 2004, which equates to $8.4 million an hour or $140,000 per minute.

But more impressive than the pure scale of the deals, what really has me awestruck is the talent, energy, creativity, optimism, patience and analytical abilities of the community of financiers serving the shipping industry who have been solving, like a Rubik’s Cube, the complex riddle of how to concurrently make a deal so attractive to buyer, seller, investor and lender that they are not only willing but enthusiastic to conclude a transaction – and who have been conducting these high stakes acrobatics while traversing the peak in the shipping markets.

This is only an excerpt of Why Cash (Flow) Was King in 2004

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