KKR and Borealis Maritime have bought a cargo shipping business from Commerzbank for $254.5m (€231m).
The infrastructure fund manager and shipping company have aquired Hanseatic Ship Asset Management (HSAM), a 100% owned subsidiary of Commerzbank that owns 18 container and dry cargo vessels.
HSAM was established in Hamburg by Commerzbank in 2013 to reduce its loan exposure to the shipping industry.
As reported by IPE earlier this year, deleveraging by European banks has resulted in a supply of cheap shipping debt in recent years.
Vessels were taken over by Commerzbank as a result of the restructuring of non-performing lending engagements. As a result, HSAM acquired a modern fleet of 13 mid-size container vessels and five mid-size dry bulk vessels between 2013 and 2015.
Embarcadero Maritime III, is the latest joint venture between KKR and Borealis Maritime to invest in distressed shipping assets.
The joint venture partners now operate a fleet of over 50 vessels, having deployed invested over $600m in vessel acquisitions.
Christoph Toepfer, CEO of Borealis Maritime, said: “The acquisition of HSAM will significantly increase our managed fleet, making us one of Europe’s leading container vessel operators.
“We believe the quality of vessels being acquired from Commerzbank is second to none and this transaction is an attractive expansion of our activities with our partners KKR.”
Brian Dillard, a member of KKR’s Special Situations team, said: “Partnering with maritime lenders to offer feasible solutions to problematic lending engagements remains a core component of our expansion strategy.”
KKR is funding the acquisition through certain of its managed funds and accounts, including its Special Situations Fund II, which, among other things, matches long-term.