Canada’s Algoma Central Corporation and Swiss-based Nova Marine Carriers have created a new joint venture that will focus on short-sea dry-bulk shipping for global markets.
The new joint venture, operating as NovaAlgoma Short-Sea Carriers (NASC), is a 50/50 joint venture between Algoma and Nova Marine Holdings, 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. Nova has now 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 the transaction, Algoma has acquired a 50 percent interest in NASH from Nova. NASH has 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 percent 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.
"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."
Vincenzo Romeo, Chief Executive Officer of Nova, said: "The global short-sea market is slowly recovering after several challenging years but is still in need of further consolidation."
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.
Algoma 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 shipowners.
Nova Marine Carriers, 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 Mediterranean, Atlantic and Persian Gulf and in Italian cabotage.