Maritime firms cast secondary eye over HK
Keith Wallis in Singapore
Hong Kong could see an increase in international maritime-related companies seeking a secondary listing in the city, but it will also have to compete with Singapore and Shanghai, ship financiers warned.
Kerwin Clayton, head of industrials in Asia-Pacific for JP Morgan Securities, said there was growing interest from maritime companies in Europe and the Middle East looking for a secondary listing in Asia.
There had been intense discussions about the advantages or disadvantages of listing in Hong Kong against Singapore, he told delegates to a shipping conference in Singapore.
'Singapore is strong particularly on a global level,' Clayton said, adding that Hong Kong had access to funds from the mainland.
He said the argument between Hong Kong and Singapore is a 'debate that goes backwards and forwards' in the investment community.
Courage Marine, a Singapore-listed dry-bulk shipping company with offices in Hong Kong and Taiwan, is set to become the latest company with a dual listing. The firm won shareholder approval on Monday to issue up to 211.7 million shares in a Hong Kong listing which has yet to be priced. Courage Marine has earmarked 70 per cent of the proceeds to buy at least one dry-bulk cargo ship.
There has also been talk in Hong Kong ship finance and legal circles of a Greek tanker owner, which is already listed in New York, seeking a secondary listing on the city's stock exchange.
Clayton said 'dozens of companies [were] lining up to go public in New York' and thought listing activity would increase.
There would be more interest in the listing of container-shipping companies rather than dry-bulk or tanker operators, he said, because the outlook for container shipping was more buoyant than the other sectors where overcapacity had depressed freight rates and earnings.
Graham Porter, a director of New York-listed container ship owner Seaspan Corp, said: 'We've studied a co-listing on all three Asian exchanges.'
The firm owns 69 container ships, including 58 that have already been delivered to operators such as Cosco Container Lines and China Shipping Container Line.
But Porter, who is also chairman of Hong Kong-based ship investment company Tiger Group, said: 'The biggest problem we have is market capitalisation and the daily trading volume.'
He said combining common and preference shares, Seaspan has a market capitalisation of US$1.9 billion in New York and any listing in Hong Kong, Singapore or Shanghai would have to be substantial.
Philip Clausius, president of Singapore shipping trust First Ship Lease Trust, said initial public offerings and bank loans along with bond offerings and private equity, are among the options being considered by shipping companies to pay for ships.
Nigel Anton, global head of shipping at Standard Chartered Bank, said that for banks The market was back with a lot of activity compared with problems two or three years ago. But he said banks preferred dealing with existing customers.
Clausius estimated the top 25 ship finance banks had a total loan book of US$343.8 billion.
New York-listed Seaspan says a secondary listing must be large as its capitalisation, in US dollars, is already: $1.9b