BERMUDA: Bulk carriers Golden Ocean Group and Knightsbridge Shipping have agreed to merge. The new company will be named Golden Ocean Group and operate a fleet of 72 vessels. Both companies reportedly are indirectly owned via trusts controlled by Norwegian-born John Fredriksen.
The management of Golden Ocean, which also manages the Knightsbridge dry bulk fleet, will be retained for the new combined company and led by Herman Billung as chief executive officer and Birgitte Ringstad Vartdal as chief financial officer.
Following the merger, Golden Ocean expects to have a fleet of 46 Capesize vessels, 10 ice class Panamax vessels, eight Kamsarmax vessels and eight Supramax vessels, of which 36 are under construction. The new company expects to have a small number of additional leased vessels and one owned through a joint venture.
Commenting on the transaction, Knightbridge chairman Ola Lorentzon and Golden Ocean chairman Fredriksen declared: "By combining Knightsbridge and Golden Ocean we seek to create a company with a unique fleet and strong balance sheet and build one of the world's leading dry bulk shipping companies. With the current weakness in the dry bulk market, we believe there will be attractive consolidation opportunities going forward.
"Our ambition is to be a clear market leader both from a financial and operational perspective. Upon an expected recovery of the dry bulk market and as newbuilds are brought into the fleet, we believe the combined company will generate significant cash flow," they added.
Bermuda-registered Knightsbridge owns and operates 27 Capesize dry bulk carriers, of which 11 are sailing and 16 are newbuildings under construction. Total capacity is approximately 4.9 million dwt.
Golden Ocean is also based in Bermuda and owns or controls 25 vessels and has newbuilding contracts for the construction of eight Supramax dry bulk vessels for delivery between 2015 and 2016. In addition, Golden Ocean also has one vessel owned through a joint venture, two vessels operating under a bareboat charter and four chartered-in vessels on long-term contracts.
According to Forbes magazine, billionaire Fredriksen "started trading oil in the 1960s in Beirut, bought his first tankers in the 1970s, ran crude oil for Iran in the 1980s, then in the 1990s, with Frontline Ltd., established himself as the king of the tanker trade".