(TSX : ALC)
ST. CATHARINES, ON and LUGANO,
Switzerland, April 19, 2017 /CNW/ - Algoma Central
Corporation and Nova Marine Carriers SA today announced the
creation of a new joint venture that will focus on short-sea
dry-bulk shipping for global markets. This new joint venture,
operating as NovaAlgoma Short-Sea Carriers, or NASC, is a 50/50
joint venture between Algoma Central Corporation (Algoma) and Nova
Marine Holdings Limited (Nova), the parent company of Nova Marine
Carriers.
NASC was formed by Nova as an October 31,
2016 carve-out from the deep sea dry-bulk freight business
operated by Nova Marine Carriers S.A. In accordance with its
agreement with Algoma, Nova has transferred all short-sea
commercial contracts to NASC and transferred its interest in NASC
and its interests in any dry-bulk vessels of less than 15,000 dwt
to a newly formed entity, NovaAlgoma Short-Sea Holding Limited
(NASH).
To complete this transaction, Algoma has acquired a 50% interest
in NASH from Nova. At closing, Algoma acquired an interest in the
NASC commercial platform and its book of business and an interest
in a fleet of 15 short-sea mini bulkers ranging in size from 5,750
dwt to 14,700 dwt. Six of these vessels are wholly owned by NASH
and the company has a 50% interest in the remaining nine vessels.
In addition to the vessels owned by NASH, NASC currently manages a
fleet of 57 short-sea vessels on behalf of other owners, bringing
the total fleet to 72 vessels. In addition, NASC is an active
charterer of vessels as required to meet the commercial needs of
its book of business.
"We are extremely pleased to be joining Nova in this promising
new business venture which we expect will be immediately accretive
to our earnings per share" said Ken Bloch
Soerensen, President and CEO of Algoma. "While the vessels
we operate in our domestic fleet are considerably larger, our Great
Lakes dry-bulk business is a short-sea business and we share many
customers and operating principles with global short-sea markets,"
Mr. Soerensen continued.
"We are excited to extend our partnership with Algoma to include
short-sea bulk shipping," said Vincenzo
Romeo, Chief Executive Officer of Nova. "The global
short-sea market is slowly recovering after several challenging
years," Mr. Romeo continued, "but is still in need of further
consolidation. Furthermore, it is obvious that both customers and
ship owners are seeking commercial partners with the financial
strength to meet their need for high quality service and
dependability. "
The joint venture will be based in Lugano, Switzerland and has offices in Rotterdam and Sofia. Areas of commercial and other synergies
between NASC and Algoma have already been identified, including
opportunities to capitalize on prospects to develop mini bulker
business within the Canadian market.
In January of 2016, Nova and Algoma created NovaAlgoma Cement
Carriers (NACC), a joint venture focused on pneumatic cement
carrying freighters and servicing global manufacturers of cement
products. Since its beginning with a fleet of three vessels in
operation, NACC has grown to a fleet of nine operating vessels with
three more under construction or in the planning stage.
About Algoma
Algoma Central Corporation operates the largest Canadian flag
fleet of dry and liquid bulk carriers on the Great Lakes – St.
Lawrence Waterway, including self-unloading dry-bulk carriers,
gearless dry bulk carriers and product tankers. Algoma also has
interests in ocean dry-bulk vessels operating in international
markets and provides ship management services for other ship
owners.
About Nova
Nova Marine Carriers SA, headquartered in Lugano, Switzerland, operates a varied fleet of modern
bulk carriers and belt self-unloading vessels ranging from 5,000
dwt up to 57,000 dwt. With over one hundred ships under
control, Nova specializes in bulk traffic in the Mediterrenean,
Atlantic and Persian Gulf and in Italian cabotage.
SOURCE Algoma Central Corporation
