Präsentation
TITEL DER PRÄSENTATION
Purchasing Loans
Textzeile Kunde lorme ipsum,
from German Ship Financing Banks
2. Textzeile Kunde
17th Marine Money Conference
Datumszeile
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
USD 450-500 Billion
Global Ship Finance
Industry Volume
2015
2012
20%
30%
70%
80%
■ Germany
Other…
■Other…
Germany
■ Other Nations
■ Other Nations
2012
German Banks’
Shipping Exposure
35
29
30
24
25
18 18
in € billion
20
15
10
5
0
18,5
14
12
7
6,5
8,5
The German Ship Financing Banks - Status Quo
Development in the German merchant fleet
Vessels with more than 1,000 GT
4000
3500
3000
2500
2000
1500
1000
500
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Vessels total
Source: Federal Maritime and Hydrographic Agency (BSH) /
German Shipowners‘Association (VDR)
The German Ship Financing Banks - Status Quo
Containership fleet by owner’s nationality
4.796
Others
Germany
1.651
Denmark
1.260
1.410
Greece
Switzerland
1.223
China
1.004
Japan
960
Singapore
710
France
South Korea
551
950
Taiwan
3.640
Source: IHS, www.ihs.com / German Shipowners‘ Association (VDR)
The German Ship Financing Banks - Status Quo
Typical Structures – 1. Asset Deal
1
Asset Deal
+
Well
known,
documentation.
standardized
process
and
+
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).
Typical Structures – 2. Share Deal
2
Share 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).
Typical Structures – 3. Enforcement
3
Enforcement
Consensual Sale
Ordinary Enforcement
+
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.
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.
+
Credit bid sometimes
possible.
+
As largest creditors, lender
can effectively control
process.
+
Transfer of vessel free from
all liens and other
encumbrances.
+
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.
+
+
-
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.
-
In case of fleet of vessels:
Coordinating of auctions at
different ports may be
difficult. Vessels should be
cargo free.
Insolvency Plan
Quick Enforcement
+
-
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.
Comparison of estimated time required and costs (w/o refinancing)
Share Deal
Estimated
Timeframe*
Consensual Sale
3-6 weeks
3-8 weeks
Estimated
Costs**
USD 10,000
USD 50,000 for
deletion of old
mortgage,
change of ownership,
registration of new
mortgage
Estimated
Legal Fees
USD 10,000 - 30,000
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.
Enforcement
Quick
auction:
1-4 weeks
USD
100,000,
+
sometimes
1-2 % of
FMV
Insolvency Plan
Proceedings
Ordinary
auct.:
2-6
months+
> 6 months
Same as
for quick
auction
+ min. 0.5
million
USD 100,000-200,000
for court and
administrators
+ USD 50,000
registration fees
USD 25,000 - 250,000
USD 75,000 - 100,000
Time required for enforced sales
Time
required*
Ordinary Enforcement
Quick Enforcement
Depending on location
of vessel and cargo
on board.
Sailing the vessel to suitable port,
preferably without cargo.
Sailing the vessel to suitable port,
preferably without cargo.
Upon arrival at port.
Arresting the vessel.
Arresting the vessel.
1-3 days.
Appraisal of the vessel.
Appraisal of the vessel.
One week.
Informing all known creditors of the
vessel and its owner.
Informing all known creditors of the
vessel and its owner.
1-3 weeks after arrest.
Publishing a notice of the vessel’s
auction in shipping gazettes.
Sale of the vessel through the court.
Distributing the sale proceeds in
accordance with the local law.
1-3 weeks after sale.
* Estimates.
Publication 2-3
months prior to
auction.
Auctioning of the vessel.
1-3 months after
auction.
Distributing the auction proceeds in
accordance with the local law.
Ehlermann Rindfleisch Gadow
Brief introduction of the Firm:
Hamburg Office
Ballindamm 26
20095 Hamburg
Germany
T +49 40 3748 1451
London Office
2 White Lion Court, Cornhill
EC3V 3NP London
United Kingdom
T +44 20 7118 1111
The primary business of EHLERMANN RINDFLEISCH GADOW is the provision of legal
advice and assistance on all kinds of maritime related transactions.
From its offices in Hamburg and London, EHLERMANN RINDFLEISCH GADOW provides
legal advice to clients in all matters related to the financing of vessels and other maritime
assets and the restructuring thereof, the structuring and implementation of shipbuilding
projects, the sale and purchase of ships, containers and other maritime assets as well as
domestic and international corporate and insolvency law and M&A deals in the maritime
industry.
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 of
EHLERMANN RINDFLEISCH GADOW is the largest in Germany in the field of maritime
finance and one of the largest in this field worldwide.
The international team of lawyers of EHLERMANN RINDFLEISCH GADOW is able to advise
on English, German, Liberian, Marshallese and South African law. EHLERMANN
RINDFLEISCH GADOW’s lawyers are admitted to these bars and to the bars of other
jurisdictions.
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’t
work without them’. Its financing experience spans three decades."
Ehlermann Rindfleisch Gadow - Recent Ship Arrests
ERG’s lawyers have recently been involved
in ship arrests and enforced sales
in these jurisdictions:
Dr. Stefan Rindfleisch
Stefan Rindfleisch specializes in the field of structured maritime financing since almost 20
years. He has advised on numerous domestic and international fleet financings and
restructurings. Stefan has comprehensive experience in special forms of financing, such as
domestic and international lease financing, maritime promissory notes and loan securitization
(pooling and repackaging of cash flow producing financial assets into securities that are then
sold to investors). Another of his areas of expertise involves the advice of private equity and
hedge funds on their investment in distressed maritime assets and shipping loans as well as
joint venture structure.
Dr. Stefan Rindfleisch
Partner
Hamburg
T +49 40 3748 1426
F +49 40 3748 1430
[email protected]
Bar Admissions /
Qualifications
Germany, Marshall Islands
Education
Universities of Freiburg and
Hamburg
Dr. jur. 1998
Languages
German
English
Voted among the
top ten shipping
lawyers worldwide
2012-2015.
Lloyd’s List
Stefan Rindfleisch is a German Rechtsanwalt and also registered lawyer admitted to practice
in the Republic of the Marshall Islands; he is a member of the German Society for
International Law of the Sea. Stefan lectures on shipping finance at the Bucerius Maritime
Executive Lectures, Bucerius Law School. He also lectures on shipping financing at the
University of Hamburg, Maritime Commercial Law and at HfB – Business School of Finance
& Management, Frankfurt and Hamburg. He is co-author of the handbook "Grundlagen der
Schiffsfinanzierung" (basics of shipping finance).
"Leading ship
financing lawyer’
Stefan Rindfleisch
‘gives solutions
instead of only
pointing out risks’."
Experience
Legal 500
 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 chemical
tankers) and the subsequent taking over of the vessels from their owners or their
insolvency 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 Henderson
Richard Henderson has over 20 years’ experience in advising lenders, ship owners and
investors on ship finance transactions, vessel construction contracts, vessel and business
sale and purchase agreements and debt restructurings. He has also advised clients
extensively on shipping related commercial contracting, such as LNG project tenders,
commercial contracts in the offshore industry and pooling agreements.
Richard Henderson
Partner
London
T +44 207 118 1101
F +44 207 118 2200
[email protected]
Bar Admissions /
Qualifications
England and Wales
Education
King’s College London
LLB (Hons)
College of Law, London
Languages
English
Richard Henderson is the author of two courses on ship finance for Lloyds Maritime
Academy and an occasional lecturer on both courses. He was also one of the original
authors of Euromoney’s book on shipping finance and has recently been a visiting lecturer
at 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.
Bettina Joos
Bettina Joos specializes in the field of structured maritime financing since almost 11 years
and has further 10 years experience in corporate and structured finance obtained during here
time with Deutsche Bank. She has advised on a large number of domestic and international
fleet financings as well as other forms of financings, such as lease financing, maritime
promissory notes and acquisition financing. Other areas of her expertise comprises advice in
restructuring and insolvency matters and portfolio transactions. Bettina also advises German
KG houses and private equity investors in corporate and investment matters.
Bettina Joos
Partner
Hamburg
T +49 40 3748 1434
F +49 40 3748 1430
[email protected]
Bar Admissions /
Qualifications
Germany
Education
Humboldt University of Berlin
Languages
German
English
Russian
Bettina Joos is a German Rechtsanwalt and lectures on shipping financing and insolvency at
HfB – Business School of Finance & Management, Frankfurt and Hamburg. She is co-author
of the handbook "Grundlagen der Schiffsfinanzierung" (basics of shipping finance), of
"Hamburger Handbuch des Exportrechts" (Handbook of Export Law) and "Enforcement of
Judgement Awards & Deeds in Commercial Matters".
Recent Experience
 Advising a PE fund on the purchase of a holding company with 18 SPVs, the acquisition
financing and implementation of corporate structure and restructuring.
 Advising a German banking consortium on the restructuring of the USD 400m financings
of eight vessels, including specific insolvency proceedings.
 Advising a German and Dutch banking syndicate on transfer of loans and restructurings of
the financings of several single purpose financings including a Dutch tax scheme in
relation 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 and
granting 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 Office
Ballindamm 26
20095 Hamburg
Germany
T +49 40 3748 140
London Office
2 White Lion Court
Cornhill
EC3V 3NP London
United Kingdom
T +44 20 7118 1111