Hellespont - Three Generations of Leadership
For 70 years the family-owned company has survived – and prospered – by adapting to changing times.
By Wendy Laursen
The Papachristidis family started in shipping in 1946. Founded by current CEO Phrixos Basil Papachristidis’s grandfather and namesake, Hellespont has been a shipowner, operator and manager across a wide spectrum of shipping sectors. Focusing mainly on tankers and bulkers, the company’s diverse history includes technical and commercial management, construction supervision, and crewing of tankers, bulkers, OSVs and even fishing trawlers.
Papachristidis’s grandfather was born in Greece in 1901. He served in the First World War, studied economics at the University of Lausanne and then joined the family’s tobacco trading business in 1926. After the great crash in 1929, the family business was ruined, and he emigrated to Canada. Before going into shipping, he became, quite by chance, the largest wholesale postage stamp dealer in Canada. It wasn’t until the end of the Second World War that he bought his first ships.
The Phrixos B. Papachristidis Company, incorporated in Montreal in 1946, was later renamed Hellespont Maritime. The company’s first ships were nine Canadian-built dry cargo vessels. The company was primarily operating a Canadian-flagged fleet in deep sea and Great Lakes trades until 1972 when it expanded internationally.
Papachristidis’ father, Basil Phrixos Papachristidis, was born in Canada in 1944. He was educated at McGill University in Canada and Columbia University in New York (where he earned M.B.A., M.Phil. and Ph.D. degrees). He also received an Award of Doctor of Science honoris causa from City University London in 2013. Basil Papachristidis is a council member of the American Bureau of Shipping, a past Chairman and Honorary Member of INTERTANKO, and a member of the Hellenic Marine Environment Protection Association (HELMEPA).
He started in the family business in 1965 and took his father’s place when Phrixos senior died in 1981. He had spent much of his time in Greece, but soon after taking over he expanded the business to London, Manila, Hamburg and Singapore.
Phrixos junior was exposed to shipping from an early age. Even today, Basil keeps a picture of his six-year-old son’s first visit to a ship on his desk. “I remember the engine room was a little too overwhelming for a six-year-old,” says Phrixos, “and I preferred the bridge. All through my childhood, my dad would have me come on some of his business trips, and I remember going to see Daewoo for the first time when I was about 17. We were building ultra-large crude carriers then, and I remember seeing the Hellespont Alhambra being built. That was very inspiring.”
He spent many summers in the office, but despite his shipping pedigree he says his father “really encouraged me to do my own thing when it came to schooling, and I graduated from New York University in 2004 with a B.A. in History and a minor in Music.”
After university, Phrixos went to work for energy and ship brokerage company Poten & Partners. That was in 2007, and he officially joined Hellespont later that year. “The way my father had me do it was to get as involved as I could in all the various departments, both technical and commercial. After some time, I ran the group’s chemical tanker chartering subsidiary.”
Taking the Plunge
Basil has been Chairman of Hellespont since 1981 and remains in that position after “throwing his son in at the deep end” in 2009 by making him CEO at the tender age of 28. “He’s always just a phone call away,” says Papachristidis. “We talk daily. My father has been through a lot of roller coaster rides in the course of his 45-year career in shipping. He’s a great source of inspiration and knowledge.”
Papachristidis also recognizes the support of company employees. “We’re a flat organization, and a lot of the people in the company have been with us for 30 years. These are people I can remember since I was a kid. So when I started as CEO I knew I was in good hands. It was important that I could draw on the wealth of experience of my father, but also on an organization that has been through the test of time.”
He emphasizes that it’s a family business and “We are all trying to achieve the same mission. The model has changed from what we’ve typically been known to do in the past. You can say we’ve evolved, but we have a long history and it wouldn’t be wise of me to neglect lessons from our past.”
Evolution of a Company
The family-run business has evolved from a private shipowner to a provider of quality marine services and solutions to the global shipping community. The group delivers integrated maritime services including commercial and technical management, construction supervision, and crewing services to charterers, owners and operators involved in the marine and offshore sectors.
The group’s diversity comes from being family-run and of modest size, says Papachristidis. “Our Athens office opened in 1955, and that has always been doing the marine technical and accounting services and, to this day, superintendency as well. Hamburg is the principal location for our business development since it opened in 2006. In that office we’ve done our financing and technical and commercial management. Our office in Singapore has been doing the third-party management and crewing in offshore. It opened in 2009. We are over 100 people now, and we are running a crew pool of around 2,000 seafarers.”
Hellespont currently has 25 vessels under management, consisting of bulkers, tankers and offshore support vessels. This includes eight ships that the company has ownership interests in and 17 ships under third-party management. So there are 25 vessels under Hellespont’s technical management plus another 30 for which it provides crewing services.
The company has an in-house-developed safety management system and is proud of its high oil company vetting rating and a zero spills record. Its Mission Statement and Code of Ethics & Conduct are among the most comprehensive in the industry.
It has also overseen construction of around 30 ships in the past 15 years. These have been at yards in China, Korea, India, Indonesia and Japan. Hellespont has built a reputation for the high standard of its new-vessel construction services in recent years, particularly in China, and its reference list includes various vessel types including PSVs, chemical tankers, ultra-large crude carriers and VLCCs. A large supervisory team is stationed onsite to manage newbuilding projects with every step being closely monitored to ensure the highest quality of ships being delivered by the yard.
“We’ve always invested very heavily in site supervision,” says Papachristidis, “and we take that very seriously because a ship’s performance depends very much on how rigorous your construction team is.”
Hellespont has also played an important role in the design of many of these vessels. Mike Kennedy, Managing Director and Chief Technical Officer, is a member of the Tanker Structure Cooperative Forum (TSCF), a group of about 30 companies including 16 tanker operators. It’s an important group (membership is by invitation only) as Intertanko sees TSCF as a possible vehicle for determining quality standards that could be accepted by the entire industry.
Manila Shipmanagement & Manning (ManShip) is Hellespont’s exclusive manning agent. It is a major part of the company’s operations with 80 people based in the Philippines, and these days the group is using exclusively Filipino crews. Many owners believe there are advantages to this approach, including closer crew cooperation and decreased intercultural conflicts in the working environment.
Most of Hellespont’s recent efforts have centered on establishing its third-party management credentials. “That was a very logical extension to the business because we felt that we could add value there,” said Papachristidis. One of the company’s clients is Scorpio Tankers. “We had started doing it for friends whom we consider partners now, and we still continue to do that. Today, it’s what I like to believe is our value added to the industry. We think we are good at running ships, and we are well-regarded among oil majors and end-users in all sectors.”
The case for outsourcing makes a lot of sense, he says: “Some companies stick to doing what they know best, which is commercial management, operating or buying and selling ships, and they don’t want to have to deal with the technical management because they believe others can do it more efficiently than they can.”
He points out that “We have a shipowning background, and it’s been more our vocation. So we take a personal responsibility for the vessels we manage and the seafarers we employ. We’ve always done that, and we think our background, our history, our modest size and the flexibility that affords is what endears us to our clients. I think it gives us a value added over a third party manager that maybe doesn’t have that ship-owning background.”
Despite currently challenging market conditions, Papachristidis is alert for opportunities and working to expand all sectors of Hellespont’s operations: owning, managing and crewing. Living now in Hamburg, he and his wife, Dr. Caroline Papachristidis, are also raising the next Papachristidis generation. The eldest two have already been on board a chemical tanker. – MarEx
Wendy Laursen is the magazine’s Asia-Pacific editor.
The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.