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Shipowners eye property ashore November 9, 2007

Posted by grhomeboy in Business & Economy.
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Increasing investment moves by shipowners, including takeovers and plans for takeovers, tend to be regarded as opportunistic, rather than strategic, by the Greek domestic market.

With few exceptions, those shipowners who have in the past proven that “they are here to stay”, the specific industry is believed not to have any particular strategy but to be desperately in search of opportunities in which to place their capital due to the high liquidity produced by maritime operations in recent years.

“Scenarios that are being discussed on the market about shipowners entry into banking groups, for instance, should be treated as merely speculative and that is why they are not likely to be fruitful,” a telecoms market official, who recently had the experience of negotiations with a major shipping group wishing to enter the telecoms market, said. “It is no accident that a large portion of shipowners’ funds are invested in the real estate market, since it gives them security, wherever they hail from,” he added.

According to a major real estate firm, it has been recently calculated that about one  percent of Greek land has come under the control of shipping firms in recent years. The liquidity generated by maritime operations has been and still is of such volume that it necessarily had to be invested somewhere, somehow. However, new alternatives are now being sought, as it seems that conditions in the real estate market have changed. Such alternatives include the acquisition of large shares, but not majority shares, in listed companies of small and medium capitalization.

Shipowners “are often driven by instinct to such placements. Securing surplus returns is their primary target, and this no harm, since that is what all investors are after,” said a banking sector official who does business with shipping firms on a daily basis. The official added that since it is shipowners who now hold most of the cash, they are attracting all sorts of proposals. However, the official had his own reservations. “I don’t believe that a scenario of shipowners wishing to buy the majority shares of Geniki Bank is true. To run a bank, you need specialized management, and maritime businesses simply do not have it,” he said.

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