Topaz Energy and Marine has successfully raised $42m from Standard Chartered Bank, Dubai in support of its fleet expansion plans.
Topaz Energy and Marine has successfully raised $42m from Standard Chartered Bank, Dubai in support of its fleet expansion plans, taking its total financing raised in 2009 to $150m - the majority of which has been deployed to support its vessel purchase and modernization program. Toapz has stated that although finance available for the shipping sector as a whole is scarce, the OSV space that the company occupies is a relative bright spot for banks.
Offshore support vessel specialist Topaz operates more than 100 modern and high-spec vessels with diverse capabilities such as anchor handling tug supply vessels, platform supply vessels, flotels, ice breakers, crew boats, cable layers, survey vessels and specialized barges. It employs a prudent vessel acquisition strategy that restricts any speculative buying other than in technological or geographical niches. This model has proven popular not just with leading, regional commercial and Islamic banks but also specialised international shipping banks and global institutions.
Topaz cfoPramod Balakrishnan said, ?Topaz has a strong balance sheet and comfortably meets its bank covenants which makes financing us a compelling case for the banks. Our overall fleet exposure is weighted towards medium and long-term contracts which helps counterbalance any spot market volatility, providing another level of comfort for the banks. The long visibility and consistent cash flows generated enable our bankers to sleep soundly.?
Russell Beardmore, director structured finance of SCB, commented: ?We are delighted to have worked with Topaz to put this loan facility into place. The bank established the Shipping Finance division in the Middle East in 2008 specifically to provide specialist financing to its relationship clients in the region. This facility is a clear demonstration of us leveraging on our strengths, network and experience to support the sustainable, long-term growth of the Gulf economy.?
Setting the stage for 2010, Topaz has stated its strategic intent to aggressively pursue growth through acquisitions into geographies of strategic importance to the global hydrocarbon markets. It has revealed that it intends to target depressed asset valuations and motivated sellers and as the OSV-market globally is characterised by smaller operators and in the wake of the global financial crisis, a certain degree of consolidation is expected.