|Ship Managers & Management Agreement
Shipowning activities require three separate types of management: (1) the shipowning function, which is that of an investment manager and includes the selection, purchase, financing and sale of vessels and overall supervision of both chartering and vessel technical management; (2) the chartering and market operations function, which involves obtaining and performing employment of the vessels; and (3) the vessel technical management function, which encompasses the day to day physical maintenance, operation and crewing of the vessels.
The Company will carry on the shipowning function in close collaboration with the Ship Managers (selection, purchase, financing, sale, finding employment for the vessels) and has entered into a Management Agreement (see Letter of Intent) with HANSEATIC SHIPPING COMPANY LIMITED (the Hanseatic) under which Hanseatic is to provide overall management of the Companys operations (chartering and market operations function & technical management function). The chartering and market operations responsibility will be fulfilled by the chartering of the Companys vessels to various shipping operating pools, which will employ the vessels primarily in the spot cargo and charter markets.
The Company believes the operation of vessels in a pool has the following benefits:
(i) the avoidance of conflicts of interest between the vessels in seeking cargoes and in the performance of specific voyages, (ii) the smoothing out of trading results in a business where earnings can fluctuate substantially even between voyages performed simultaneously by vessels of equal earnings potential; (iii) increased market presence; and (iv) improved cash flow from the operation of a large dry bulk transportation company.
Hanseatic with offices at 111 Spyrou Araouzou Street, Limassol, Cyprus is one of the leading Ship Management Companies in the world with more than seventy vessels under its management. The House of Schulte, shipowners since 1883 in the Hanse Cities of Bremen and Hamburg was behind the establishment of Hanseatic in Cyprus in 1972. Hanseatic was the first offshore company and the first shipmanagement company in Cyprus. Since that time the Island has developed into a major ship owning and ship management centre and the Cyprus Register is one of the largest in the world. Quality is paramount, to this end Hanseatic was the driving force behind the formation of ISMA (International Ship Managers Association) whose Code of Shipmanagement Standards has yet to be exceeded in requirements by any other Code. Hanseatic was the first company to be certified under ISMA and continues to exceed the standards
More info regarding Hanseatic may be obtained from www.hanseatic.com.cy.