Ridgebury Tankers is still looking at acquiring secondhand tonnage, CEO Robert Burke told the TradeWinds Shipowners Forum, held at Posidonia in Athens today.
Burke sees two big issues affecting the industry, the first being the low price of crude oil, which could lead to future tanker acquisitions by the Connecticut-based firm.
“I don’t understand how the price of a commodity can fall by half and the analysts only project that it will only increase by a couple of extra percentage points,” Burke told delegates.
“If you look at the driving miles so far in the US, India and China, it’s all surprised to the upside and I think that’s going to help tankers quite a bit over the next year or so and we have thought about buying some older tonnage.”
In early May, Ridgebury bought DHT Holdings’ 15-year-old suezmax DHT Target (164,600 dwt, built 2001) for a reported $22.5m. Last year it bought four VLCCs, each around 15 years of age, from Independent Tankers Corp for $135m en bloc.
“The other issue is access to cash, and everybody always asks where the money’s going to come from,” Burke went on.
“The money will come when the money’s supposed to come. It will come when PE [private equity] thinks they can quote-unquote ‘do a trade’. In fact, we’re backed by a PE group [Riverstone Holdings] and they allow us to buy one ship at a time, like real shipowners, in the secondhand market,” he continued.
“We think we’ve had some really good entry points,” Burke said, “but it’s difficult to buy bigger ships – or sell bigger ships – without moving the market substantially.
“I think our industry a victim of the tragedy of economics, that if we just buy one more ship and no one else does, that we can get extra return on that – and, eventually, we’re sewing the seeds of our own destruction,” Burke finished.
In October last year, Splash broke the news Ridgebury Tankers had put its fleet of seven suezmaxes, six MR product tankers and two aframaxes up for sale, keeping only its four VLCCs, but so far the Connecticut-based shipping company has yet to find a buyer for the vessels.