On October 11, ship owning fund Pelagic Partners in partnership with Cypriot outfit Interorient Shipmanagement took delivery of the MR2 product tanker Star Osprey. The vessel, built in 2007, will join the Norient Product Pool. The price was below recent averages and competitive especially with regards to the very low order book.
The latest acquisition enables the Pelagic Fund I to stretch into its fourth promising segment after Bulkers, PCTC and LPG. “With the acquisition of Star Osprey, we believe to have positioned ourselves into the right stage in the Product Tanker cycle, which we are bullish towards for 2022 and beyond”, says Atef Abou Merhi, Managing Director of Pelagic Partners. “After the peak storage volumes in 2020, the world oil reserves decreased to even below average figures. Currently, oil demand is slowly but surely reaching pre- pandemic levels again, and a more complex trade with new product flows has emerged, demanding higher ton miles. It will not be long before the market returns to healthy levels.”
Further LPG coasters
Additionally, beginning of September two further LPG carriers were acquired by Pelagic Partners together with Danish gas shipping specialist B-Gas A/S: B-Gas Saturn and B-Gas Jupiter, bringing the total number of LPG carriers controlled by the Fund I to five. The two semi-ref LPG carriers were built in 2003 and 2004 and offer capacities of about 3,000 cbm each.
Closing Fund I, opening Fund II
Through the latest additions, Fund I comprises of a total of eight vessels. It has a current value of around 60 million USD, which are well diversified and with minimal downside risk. Hence, Fund I has been completed and officially closed.
Preparations are on-going to kick off Pelagic Fund II in January 2022. “Given the success of Fund I with an AUM target of 50 million USD, we look forward to go even bigger with our new Fund II, which has an AUM target of 100 million USD”, says Atef Abou Merhi.
The investment philosophy of the upcoming Fund II will be based on the successful core principles of Fund I: opportunistic and diversified, with a focus on shipping segments in which the Fund Managers have core expertise. Fund II will furthermore prioritize eco-friendly projects to support the efforts to decarbonize the shipping industry. Upon the start of Fund II, an internal ESG program will commence with one of the market leaders in this segment in order to handle in-house reporting transparently, according to all ESG standards and in line with the investment philosophy stated above. Pelagic Partners expects the Fund’s first ESG report during Q2 2022.