Mercator Lines News

Indian shipping company Mercator Limited has decided to sell one of its vessels, Vedika Prem, as part of its strategic plan.The MR2 tanker has been sold for a total consideration of INR 28.54 Crore (around USD 4.1 million) to an unnamed buyer."The deal was concluded yesterday (November 29). The proceeds from the sale would be used to meet the companies debt obligations and liabilities," said a stock exchange annoucement the company with diversified business interests in Coal, Oil & Gas, Commodity Transportation and Dredging."The aforesaid transaction does not fall within the definition of related party transactions and not a material related party transaction.

Singapore-based Mercator Lines says its judicial manager (JM) has filed an application to wind up the company. "Subsequent to the termination of the  Implementation Agreement (IA), the Judicial Manager (JM) held preliminary discussions with several potential investors to explore transferring the Company’s listing status and/or restructuring the Company," said a stock exchange filing. Whilst these potential investors have expressed an interest in the Company’s listing status, to date the Company has been unable to justify an application for a further extension on the Judicial Management Order. Accordingly, the JM has filed an application to wind up the Company. "The hearing date for the winding-up application has been fixed on 8 September 2017," said the company.

Dry bulk shipping company Mercator Lines has inked an agreement to sell another vessel in an attempt to reduce its debt. The MV Kalpana Prem will be sold for US$2.9 million to a third party. It is expected to be delivered in April. In January, the dry bulk shipping firm said it was selling five vessels for US$32.3 million. The latest vessel is secured to the company's major shareholder, Mercator International (MIPL), and will be sold to a third party for US$2.9 million, reducing the debt owed to MIPL. Mercator Lines was placed under judicial management in January. Mercator International Pte, subsidiary of Mercator, has received approval from Singapore Exchange for divestment of its entire stake in Mercator Lines (Singapore).

Singapore’s dry bulk shipping company Mercator Lines Limited has has entered into Memoranda of Agreements to sell five bulk carriers, the company’s judicial manager said. The judicial manager appointed to oversee the bankruptcy of Mercator Lines (Singapore) has announced five ships of the listed dry bulk subsidiary of the Indian owner are to be sold to lenders for $32.3m. The vessels are M.V. Sri Prem Veena, M.V. Garima Prem, M.V. Garv Prem, M.V. Gaurav Prem and M.V. Aarti Prem which are secured to the syndicate lenders. The bulkers are expected to be delivered to their new undisclosed owners by February 2016. The sale comes in the wake of Mercator Line’s decision to exit dry bulk businesses as part of its restructuring endeavors.

As a part of an ongoing portfolio restructuring exercise following booking of losses for three years in a row, Mercator Limited has decided to exit dry bulk business carried on by its arm Mercator Lines(Singapore) Ltd(MLS). Mercator has 11 bulkers in its fleet, ranging between 70,000 and 92,50 dwt built from 2001 to 2010. The Board of Directors of the company in a meeting have  approved to stake sale proposal and a sole placement agreement has been appointed to identify the prospective investor/buyer for the sale of entire stake in Singapore Stock Exchange listed  MLS. The bulk carriers business has been the worst affected by the downturn in the shipping cycle with the Baltic Dry Freight having collapsed from a level of 11…

Mercator Lines (Singapore) reported a revenue of US$ 16.5 million for Q1 2015, an increase of 19% as compared to correspoding period in the previous previous year, however a net loss of US$ 7.1 million for the quarter as against a loss of USD 6.7 million in the corresponding period in the previous year. EBITDA at USD 3.6 million as against USD 3.4 million in Q1 FY 2014. The Company continues to enjoy a healthy EBITDA margin of 22%. Time Charter Equivalent (TCE) rate achieved at around USD 12,083 per day vs. average market rate of USD 6,304 per day in Q1 FY 2015, indicating a premium of 92%. The revenue for Q1 FY 2015 was at USD 16.5 million as against USD 13.9 million in Q1 FY 2014.

Mercator Lines (Singapore) Indian-owned international dry bulk shipping company cuts short charters, sell a ship. The sale of the vessel Sri Prem Putli was concluded on 21st March, 2013 resulting in net proceeds of USD 44.4 million. The proceeds from the sale of this ship have been partly used for paying down company’s debts and partly for payment of compensation & expenses relating to termination and change of terms of long term chartered-in vessels. Based on current market rates, the early termination of long term contracts would create estimated savings of around USD 25 million over the next two years. In addition, the Company prepaid debt close to USD 30 million which would be applied towards immediate repayment schedule.

Mercator Lines has signed a share purchase agreement for the sale of its 81% stake in Target Ship Management. The sale of its 81% stake in the Company comprised 426 ordinary shares and realised SGD 128,709.00 in cash. Following the disposal, Target Ship ceased to be a subsidiary of the Mercator Lines. Mercator state that the transaction is not expected to have a material effect on the consolidated net tangible assets per share and earnings per share of the company for the current financial year. Common directors have resigned from the Board of Directors of Target Ship and the substantial shareholder also disposed its shareholdings in Target Ship.

Mercator Lines (Singapore) agrees to sell its 279,022 dwt  VLOC 'Sri Prem Putli'. The vessel was built in 1993 and converted from Very Large Crude Carrier (VLCC) to Very Large Ore Carrier (VLOC) in 2009. The Vessel is expected to be delivered to its buyers in March 2013. The sale is subject to the approval of the mortgagee to which the Vessel has been mortgaged. The sale would be along with her existing charter. Assuming a delivery date of 31 March 2013, the Book Value of the Vessel on the date of her delivery will be about US$ 67.44 mn and considering net proceeds of US$ 44.40 mn, the loss on account of sale of the Vessel will be about US$ 23.04 mn.

Mercator Lines (Singapore) agree early termination & settlement agreements with owners of bulkships 'Chaitali Prem' & 'Chanchal Prem'. Briefly, the existing charter of M.V. “Chaitali Prem” ends on or about 31 August 2014. Under the terms of the relevant Early Termination Agreement, the Company will redeliver the vessel to its owner by 31 December 2012. The existing charter of M.V. “Chanchal Prem” commenced under a charter party dated 20 July 2007 and has a duration ending on a date no later than 15 November 2015. Under the terms of the relevant Early Termination Agreement, the Company will redeliver the vessel to its owner by 31 March 2013. (a) Cash Compensation: Mercator will pay to the owners an aggregate cash compensation of US$9,017,000.

For the half year period ended 30th September, 2011, Mercator Lines Ltd. registered 25% growth in Total Income which stood at Rs.1584 crores (Rs.1268 crores). The Consolidated Net Profit for the period stood at Rs.21.41 crores (Rs.113.22 crores). During the period, the Coal Division contributed 58% revenue while Dry Bulk contributed 22%; Tanker 10%; Dredging 5% and Offshore Division 5%. The coal volumes are expected to further improve in the coming quarters. The recent coal mine acquired in Indonesia would commence commercial operations in the last quarter of FY12. The Oil and Gas Division has successfully commissioned FPU unit in Nigeria and the operations are doing well as per schedule. Exploration activities of two onshore oil blocks in Gujarat are on schedule.

Thome Ship Management, S'pore managed Mt. Kirsten, SCI owned LPG “Nanga Parbat” and Mercator, India owned MT.“Harsha Prem”,Sanmar owned MT. “Sanmar Majesty” and Fuel Supplies, Male owned MT. “Hibaru” were undergoing repairs in the yard Jan-Feb. Colombo has been attracting many types of callers, Tanker owner/ managers have been regular visitors who take advantage of the excellent facilities available for tanker owners in this region. This is quite a unique occasion where the yard is handling five significantly sophisticated tankers with extensive work scopes, simultaneously.

Heidmar Inc. announced that Mercator Lines Limited of India China Shipping Development and Conti Reederei of Germany will be joining the Sigma Tankers pool and that Emirates Trading Agency of Dubai an existing member of both Sigma and the Heidmar managed Dorado Tankers pool, will be entering two more vessels into Sigma Tankers. Mercator and China Shipping, also members of the Dorado Tankers pool, will enter one vessel each into Sigma Tankers. Conti will take delivery of two coated LR2 tankers from Hyundai Heavy Industries in 2009. These two vessels have been fixed on time charters and will be entered into Sigma Tankers at the end of these charters. Sigma Tankers recently entered the clean LR2 trade with the delivery of two newbuildings in July and September.

A second Aframax tanker belonging to Mumbai-based Mercator Lines, the 105,000 dwt Prem Divya, has been coated with International Paint’s foul release coating, Intersleek 900. The move comes just nine months after sistership Prem Pride had her vertical sides coated with the latest generation patented fluoropolymer at Dubai Drydocks World. This time though, the hull upgrade of the ‘Prem Divya’ involved the entire underwater area of the 1998-built vessel during the tanker’s second special survey. “We had monitored the ‘Prem Pride’s’ fuel consumption closely,” said Mercator Lines’ GM Amit Agrawal.

The rate for Suexmax vessels has jumped by 53% from $52,866 to $81,073 and that of Aframax vessels by 40% from $31,060 to $43,528 during the period. To capitalise on high freight rates, Indian shipping lines like Shipping Corporation of India, Great Eastern Shipping and Mercator Lines are planning to expand their fleet size. Shipping Corporation of India is planning to invest around Rs 350 crore in the next two years to acquire new vessels while Great Eastern Shipping is expected to commit a capital of nearly Rs 4,900 crore to expand its fleet size. (Source: www.business-standard.com)

Mumbai-based Garware Offshore Services Ltd., a company that offers ships for oil and gas exploration activities, plans to enter the shipbuilding business by setting up an exclusive facility for making offshore support vessels. This shipbuilding yard will be a joint venture with Norway-based ship manufacturer Havyard Leirvik AS, promoted by Havyard Group AS. Havyard Leirvik is a leader in making offshore ships, ice-breaking ships and other types of specialized vessels. According to the Shipyards Association of India, shipbuilding will entail an investment of about $76.1m by 2017. Reportedly, the venture could be 50:50, though nothing has been finalized.

Mercator Lines, is planning to expand its business portfolio by foraying into the offshore oil exploration sector. The company is looking for global partners to form a consortium to bid for Indian offshore blocks under the forthcoming round of NELP bids, apart from overseas blocks, including some of the South East Asian and Arabian Gulf blocks. It is in talks with a few European companies, sources said. Mercator Lines, which has forayed into offshore support services and is in the process of acquiring a $180m drilling rig, is aiming at forward integration by getting into the exploration business, which would also give it a captive market for its fleet of rigs and other offshore assets.

The 'A' rated, 65 million GT North of England P&I Club has alerted shipowners in the Middle East and India yesterday (20 September 2006) to the possibility of more sale and purchase disputes and a further increase in their P&I premiums. The warnings were given at a seminar attended by around 80 representatives of Middle-Eastern and Indian shipowners at the Dubai Beach Resort in the UAE, which North of England organised in conjunction with sale and purchase experts from international shipping law firms Ince & Co and Mills & Co. According to the club's associate director Katherine Birchall, 'As a result of recent fluctuations in freight rates in both the dry cargo and tanker markets…

With the boom in the oil and gas exploration sector, fueled by the recent awarding of new blocks under NELP VI, Indian shipping companies are tanking up to sharpen their focus on the offshore segment. Only last month, Oil and Natural Gas Corporation (ONGC) came out with a tender for chartering of around 26 offshore supply vessels, with mobilization requirement up to the third week of November. Shipping companies such as Great Eastern Shipping, Varun Shipping and Mercator Lines have lined up significant investments in this sector in the current fiscal. In fact, the boom in the offshore sector is one of the reasons that prompted GE Shipping to de-merge its offshore division into a separate company, Great Offshore Ltd, to get higher valuations from this business.