Präsentation
TITEL DER PRÄSENTATION
Textzeile Kunde lorme ipsum,2. Textzeile Kunde
Datumszeile
Purchasing Loansfrom German Ship Financing Banks
17th Marine Money Conference
New York, 9th November, 2016
Agenda
1. Introduction
2. Status Quo of German Ship Financing Banks
3. Case Studies
4. Q&A
The German Ship Financing Banks - Status Quo
70%
30%
2012
Other…
80%
20%
2015
Other…■ Germany
■ Other Nations
USD 450-500 BillionGlobal Ship FinanceIndustry Volume
■ Germany
■ Other Nations
German Banks’Shipping Exposure
12
6,5
1818,5
29
14
7
18
8,5
24
0
5
10
15
20
25
30
35
in€
bill
ion
2012
The German Ship Financing Banks - Status Quo
0
500
1000
1500
2000
2500
3000
3500
4000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Vessels total
Development in the German merchant fleetVessels with more than 1,000 GT
Source: Federal Maritime and Hydrographic Agency (BSH) /German Shipowners‘Association (VDR)
The German Ship Financing Banks - Status Quo
551710
950 960 1.0041.223 1.260
1.4101.651
4.796
3.640
South
Kore
a
Fra
nce
Taiw
an
Sin
gapore
Sw
itzerland
Japan
Chin
a
Gre
ece
Denm
ark
Germ
any
Oth
ers
Containership fleet by owner’s nationality
Source: IHS, www.ihs.com / German Shipowners‘ Association (VDR)
The German Ship Financing Banks - Status Quo
Well known, standardized process and
documentation.
Huge sale and purchase market.
New Owner is incorporated by buyer (no DD).
Vessel will be sold free from any mortgages and
other encumbrances other than maritime liens
attached to the vessel.
All existing contracts (e.g. management contracts,
bareboat and time charter contracts, insurance
policies etc.) must be (re-)entered into.
New registration of vessel and mortgages required.
Maritime liens remain attached to the vessel (as
always).
+
+
-
+
+
-
Asset Deal
1
-
Typical Structures – 1. Asset Deal
Quick, lean and inexpensive process.
No transfer of vessel required, no re-registration of
vessel.
Vessel continues in operation.
No new oil major vetting and approval (tankers only).
All existing contracts (e.g. management contracts,
bareboat and time charter contracts, insurance
policies etc.) remain in place.
No automatic cleaning of vessel from other liens and
debts (e.g. trade creditors).
Assumption of all existing debt of shipowner (DD of
shipowner required).
+
+
-
+
+
+
-
Share Deal
2
Typical Structures – 2. Share Deal
Consensual Sale Insolvency Plan
Quick and lean process.
Only the usual costs and
fees for the deletion and
re-registration of the vessel
and mortgage and the
legal fees are payable.
Purchase Price and credit
claim could be set off
against each other.
Requires shareholders’
approval;
nuisance fee?
No automatic cleaning of
vessel from other liens and
debts (e.g. trade creditors).
Probably new oil major
vetting and approval in
case of tankers.
As largest creditors, lender
can effectively control
process.
Discharge of junior ranking
mortgages through
insolvency plan.
Continuation of vessel‘s
operation.
Costs and fees.
Time required.
New oil major vetting and
approval in case of tankers.
No automatic cleaning of
vessel from other liens and
debts (e.g. trade creditors).
Participation of junior
mortgagee could turn out to
be very difficult.
+
-
+
-
+
-
Ordinary Enforcement
Credit bid sometimes
possible (depending on
jurisdiction).
Transfer of vessel free from
all liens and other
encumbrances.
Costs and fees.
Temporary suspension of
vessel’s operation (lay up).
New oil major vetting and
approval in case of tankers.
In case of fleet of vessels:
Coordinating of auctions at
different ports may be
difficult. Vessels should be
cargo free.
+
+
-
-
-
-
Quick Enforcement
Credit bid sometimes
possible.
Transfer of vessel free from
all liens and other
encumbrances.
Relatively quick process (1-4
weeks).
Costs and fees much less
than ordinary auction due to
faster process.
(Short) suspension of vessel’s
operation (lay up).
New oil major vetting and
approval in case of tankers.
Quick enforcement
procedures only available at
selected ports (e.g. Malta,
Gibraltar, Rotterdam)
In case of fleet of vessels:
Coordinating of auctions at
different ports may be difficult.
Vessels should be cargo free.
+
+
-
-
+
+
-
-
Enforcement3
+
+
+
-
-
-
-
-
Typical Structures – 3. Enforcement
EnforcementInsolvency Plan
Proceedings
EstimatedTimeframe*
EstimatedCosts**
EstimatedLegal Fees
Quickauction:
1-4 weeks
USD100,000,
+sometimes
1-2 % ofFMV
USD 25,000 - 250,000
> 6 months
USD 100,000-200,000for court and
administrators+ USD 50,000
registration fees
USD 75,000 - 100,000
Share Deal
3-6 weeks
USD 10,000
USD 10,000 - 30,000
* Per vessel, but several vessels can be dealt with at the same time.
** Per vessel; depending on the vessel‘s purchase price/market value.
Consensual Sale
3-8 weeks
USD 50,000 fordeletion of old
mortgage,change of ownership,
registration of newmortgage
USD 10,000 - 30,000
Same asfor quickauction
+ min. 0.5million
Ordinaryauct.:
2-6months+
Comparison of estimated time required and costs (w/o refinancing)
Sailing the vessel to suitable port,preferably without cargo.
Sailing the vessel to suitable port,preferably without cargo.
Depending on locationof vessel and cargo
on board.
Arresting the vessel. Arresting the vessel.Upon arrival at port.
Appraisal of the vessel. Appraisal of the vessel.1-3 days.
Informing all known creditors of thevessel and its owner.
Informing all known creditors of thevessel and its owner.
One week.
Publishing a notice of the vessel’sauction in shipping gazettes.
Auctioning of the vessel.
Distributing the auction proceeds inaccordance with the local law.
Sale of the vessel through the court.
Distributing the sale proceeds inaccordance with the local law.
1-3 weeks after arrest.
Publication 2-3months prior to
auction.
1-3 weeks after sale.
1-3 months afterauction.
Ordinary Enforcement Quick EnforcementTime
required*
Time required for enforced sales
* Estimates.
Ehlermann Rindfleisch Gadow
Hamburg OfficeBallindamm 2620095 HamburgGermanyT +49 40 3748 1451
London Office2 White Lion Court, CornhillEC3V 3NP LondonUnited KingdomT +44 20 7118 1111
Brief introduction of the Firm:
The primary business of EHLERMANN RINDFLEISCH GADOW is the provision of legaladvice and assistance on all kinds of maritime related transactions.
From its offices in Hamburg and London, EHLERMANN RINDFLEISCH GADOW provideslegal advice to clients in all matters related to the financing of vessels and other maritimeassets and the restructuring thereof, the structuring and implementation of shipbuildingprojects, the sale and purchase of ships, containers and other maritime assets as well asdomestic and international corporate and insolvency law and M&A deals in the maritimeindustry.
Our clients are ship financing banks, PE and hedge funds, family offices and other financiers,shipowners, ship managers and ship builders as well as the initiators of closed end funds.
With 25 lawyers being exclusively specialized in the above fields, the legal team ofEHLERMANN RINDFLEISCH GADOW is the largest in Germany in the field of maritimefinance and one of the largest in this field worldwide.
The international team of lawyers of EHLERMANN RINDFLEISCH GADOW is able to adviseon English, German, Liberian, Marshallese and South African law. EHLERMANNRINDFLEISCH GADOW’s lawyers are admitted to these bars and to the bars of otherjurisdictions.
Rankings of the Firm (extract):
Chambers Global Rankings: Band 1
"Ehlermann Rindfleisch Gadow is the ‘indisputable market leader’.“
Legal 500:
"…‘absolute experts in ship financing’ with several clients stating that they ‘won’twork without them’. Its financing experience spans three decades."
Ehlermann Rindfleisch Gadow - Recent Ship Arrests
ERG’s lawyers have recently been involvedin ship arrests and enforced sales
in these jurisdictions:
Dr. Stefan Rindfleisch
Voted among thetop ten shippinglawyers worldwide2012-2015.
Lloyd’s List
"Leading shipfinancing lawyer’Stefan Rindfleisch‘gives solutionsinstead of onlypointing out risks’."
Legal 500
Dr. Stefan RindfleischPartner
HamburgT +49 40 3748 1426F +49 40 3748 [email protected]
Bar Admissions /QualificationsGermany, Marshall Islands
EducationUniversities of Freiburg andHamburgDr. jur. 1998
LanguagesGermanEnglish
Stefan Rindfleisch specializes in the field of structured maritime financing since almost 20years. He has advised on numerous domestic and international fleet financings andrestructurings. Stefan has comprehensive experience in special forms of financing, such asdomestic and international lease financing, maritime promissory notes and loan securitization(pooling and repackaging of cash flow producing financial assets into securities that are thensold to investors). Another of his areas of expertise involves the advice of private equity andhedge funds on their investment in distressed maritime assets and shipping loans as well asjoint venture structure.
Stefan Rindfleisch is a German Rechtsanwalt and also registered lawyer admitted to practicein the Republic of the Marshall Islands; he is a member of the German Society forInternational Law of the Sea. Stefan lectures on shipping finance at the Bucerius MaritimeExecutive Lectures, Bucerius Law School. He also lectures on shipping financing at theUniversity of Hamburg, Maritime Commercial Law and at HfB – Business School of Finance& Management, Frankfurt and Hamburg. He is co-author of the handbook "Grundlagen derSchiffsfinanzierung" (basics of shipping finance).
Experience
Advising a PE investor on the purchase of a shipping company owning and controlling 10+vessels.
Advised a US based PE fund on the purchase of 14 shipping loans (product and chemicaltankers) and the subsequent taking over of the vessels from their owners or theirinsolvency administrators, respectively.
Advising a bank on the arrest and auctioning of a fleet of vessels in Gibraltar. Advising a bank on options to arrest and auction a vessel in Malta. Advised a banking consortium in connection with the financing of a fleet of 30+ container
vessels (> USD2 billion). Advised a shipping company on the restructuring of its 15+ vessels (> USD 600 million). Advised a German corporate finance advisor and US based hedge fund on a role-up and
master KG structure involving 12+ vessels. Advising a consortium of German banks on the restructuring of the financing of 13
container vessels. Advising on the sale of a group of ship management and trust services companies.
Richard HendersonPartner
LondonT +44 207 118 1101F +44 207 118 [email protected]
Bar Admissions /QualificationsEngland and Wales
EducationKing’s College LondonLLB (Hons)College of Law, London
LanguagesEnglish
Richard Henderson has over 20 years’ experience in advising lenders, ship owners andinvestors on ship finance transactions, vessel construction contracts, vessel and businesssale and purchase agreements and debt restructurings. He has also advised clientsextensively on shipping related commercial contracting, such as LNG project tenders,commercial contracts in the offshore industry and pooling agreements.
Richard Henderson is the author of two courses on ship finance for Lloyds MaritimeAcademy and an occasional lecturer on both courses. He was also one of the originalauthors of Euromoney’s book on shipping finance and has recently been a visiting lecturerat Shanghai Maritime University.
Experience
Advising a private equity fund on contracting for and financing a series of newbuildings(including Korea export credit finance).
Advising a Japanese shipowner on contracting to build and charter LNG newbuildings. Advising a Japanese shipowner on Japanese export credit financing of newbuildings. Advising a private equity fund on contracting four offshore support vessels and
Norwegian export credit financing. Advising the issuer on Norwegian bond financing. Advising bank lenders on financing several series of newbuildings and refinancing
distressed vessels. Advising finance party on sale and leaseback financing of a fleet of vessels. Advising lessor/equity on restructuring of existing financings. Advising private equity fund on a range of financing options for Chinese newbuildings.
Richard Henderson
Bettina Joos
Bettina JoosPartner
HamburgT +49 40 3748 1434F +49 40 3748 [email protected]
Bar Admissions /QualificationsGermany
EducationHumboldt University of Berlin
LanguagesGermanEnglishRussian
Bettina Joos specializes in the field of structured maritime financing since almost 11 yearsand has further 10 years experience in corporate and structured finance obtained during heretime with Deutsche Bank. She has advised on a large number of domestic and internationalfleet financings as well as other forms of financings, such as lease financing, maritimepromissory notes and acquisition financing. Other areas of her expertise comprises advice inrestructuring and insolvency matters and portfolio transactions. Bettina also advises GermanKG houses and private equity investors in corporate and investment matters.
Bettina Joos is a German Rechtsanwalt and lectures on shipping financing and insolvency atHfB – Business School of Finance & Management, Frankfurt and Hamburg. She is co-authorof the handbook "Grundlagen der Schiffsfinanzierung" (basics of shipping finance), of"Hamburger Handbuch des Exportrechts" (Handbook of Export Law) and "Enforcement ofJudgement Awards & Deeds in Commercial Matters".
Recent Experience
Advising a PE fund on the purchase of a holding company with 18 SPVs, the acquisitionfinancing and implementation of corporate structure and restructuring.
Advising a German banking consortium on the restructuring of the USD 400m financingsof eight vessels, including specific insolvency proceedings.
Advising a German and Dutch banking syndicate on transfer of loans and restructurings ofthe financings of several single purpose financings including a Dutch tax scheme inrelation to private equity investors
Advised German banks on the arrests and auctioning of a vessels in Netherlands, USA,Netherlands Antilles, Panama, South Korea, Singapore, Hong Kong, Belgium.
Advised a German bank regarding the restructuring of several ship financings andgranting of new financings (including guarantee facilities).
Advised a German bank on the sale of a loan portfolio (with insolvency background) Advising a German Bank on the purchase of a loan portfolio...
Ehlermann Rindfleisch Gadow
Hamburg OfficeBallindamm 2620095 HamburgGermanyT +49 40 3748 140
London Office2 White Lion CourtCornhillEC3V 3NP LondonUnited KingdomT +44 20 7118 1111
