ECONOMY

UK investors consider entering Greek coastal shipping market

A well-known English investment consortium with high cash flow is examining possible entry into the Greek coastal shipping market. Reports suggest that first contacts have already taken place with the shareholders of listed coastal shipping companies to acquire their stakes. Industry sources believe that this development is the outcome of a general restructuring aimed at the creation of new schemes either through acquisitions or partnerships. This was also noted in the annual report by XRTC, the shipping consultancy of Natexis Banques Populaires, on Greek coastal shipping and its prospects. It stressed that within the next months there would be activity for cooperation with or acquisition of companies in coastal shipping, instead of building new vessels whose costs would have been very high. The pace of changes in the coastal shipping sector will depend on the attitude of main figures Pericles Panagopoulos and Panos Laskaridis. Also significant will be the role of Minoan Lines, of ANEK’s Yiannis Vardinoyiannis and of Maritime of Lesvos’s Apostolos Ventouris. At any rate, developments in the industry are on the way and are connected to three factors: – The opening of the domestic market regarding fares and the expected further liberalization of the institutional framework, as determined by European regulations. These institutional developments create new prospects and opportunities for the domestic market in line with commercial interest. – The reduction of yields in capital invested in the Adriatic Sea lines, particularly by the major companies. The listed firms that are active in the Adriatic (Attica, Blue Star, Minoan and ANEK) effectively recorded losses in the first half of the year: Attica had 10.9 million euros of losses, while Blue Star doubled its losses in this line from 1.8 to 3.6 million euros. The other two companies do not break down their figures according to routes, but their negative picture is obvious compared with the same period last year. – In the 2001-2018 period, 1 billion euros will be spent to serve about 100 «unpopular» routes. Today the Merchant Marine and the Aegean and Island Policy ministries spend an annual 50 million euros subsidizing ships that travel to destinations off the tourist trail. Consequently, coastal shipping companies seem to be more interested in domestic routes, where the returns are higher, and any activity now will be aimed at the creation of larger groups that will increase market shares and achieve economies of scale.