Germany’s oldest bank Joh. Berenberg Gossler & Co has created a $500m fund with an unnamed private-equity investor to jointly grant loans to about 400 of Berenberg’s shipping clients, reports say.
In an interview with Bloomberg, Philipp Wuenschmann, Berenberg’s head of shipping, said the partners aim to fill funding gaps left by Germany’s biggest ship financiers, many of whom are making drastic cuts to their exposure to shipping.
Berenberg is targeting “dollar-based funds” and institutional investors, which “are much more familiar with the sector than their European counterparts” and of whom many don’t wish to employ their own shipping teams, Wuenschmann told Bloomberg.
The partners reportedly plan to offer so-called unitranche loans that combine senior loan and subordinate debt components in one instrument. The combination increases the loan-to-value ratio to 70%, compared with about 40% for single loans.
“Second-hand vessels are sold near scrap value, so the chances of a further retreat of asset prices are very small and we are seeing the opportunity-risk profile improving,” Wuenschmann said in the interview.
The Hamburg-headquartered bank signed a memorandum of understanding with the international investment firm at the end of June.