Shipping magnate John Fredriksen
is Norway's richest man, his tanker company Frontline (FRO)
is the world's biggest, and now his week-old gas transport venture Golar LNG (GLNG)
has already dwarfed all competitors.
Golar LNG raised $280 million in a private placement last week to fund the acquistion of six highly-prized Liquefied Natural Gas (LNG) tankers from another Fredriksen company Osprey Maritime.
But the acquisitions are not yet over, said Tor Olav Troim, Fredriksen's right-hand-man both at Frontline and Golar. Troim said the money raised last week would also go towards a down-payment on two more LNG tankers to be built at both Daewoo and Hyundai in South Korea, and possibly more at other yards. Troim said Golar held options to have four more LNG tankers constructed but had yet to decide which of those it would take up. "We're working on it right now," he said. Shipping sources said that alongside Hyundai and Daewoo, the Samsung yard was also in the picture.
Through Frontline, Fredriksen has demonstrated a staggering knack for expansion, primarily through the 1997 acquisition of Swedish tanker owner ICB, then through last year's acquisition of the debt-laden London-based Golden Ocean. Sources said that a presentation on the Golar LNG roadshow, under the title "management experience," showed Frontline's market capitalization soaring from $50 million in 1997 to $1.8 billion this year.
With 19 percent market share, Frontline dominates the million-barrel crude tanker sector, which plies the oil trades out of West Africa and the Mediterranean. And with more than 30 two-million-barrel VLCC, or 7.5 percent market share, Frontline dominates oil trades from the Mideast Gulf.
LNG is a very different sector to crude tankers, with most ships tied in to long-term contracts, no spot market and very few ships controlled by independent operators.
Only two independents compete with Golar: Exmar, the LNG division of the Belgian CMB group, with three ships on order and options for four more, and Bergesen with two on order and an option for one more.
With six in hand and two in the pipeline, Golar has already taken the lead. Merger rumors are rife, but Troim declined to comment on whether Golar had been talking to Exmar. The six LNG ships that Fredriksen already owns were acquired earlier this year, when he bought out the U.K.'s Barclay Brothers and Indonesia's Suharto family to take control of Osprey Maritime, which was de-listed from the Singapore Stock Exchange last Tuesday. - (Reuters)