Gambling on YRC
This is unbelievable
From
BloombergDec. 15 (Bloomberg) -- YRC Worldwide Inc., seeking to avoid bankruptcy by exchanging equity for debt, faces resistance to the swap from investors holding bonds and derivatives that pay out in a default, according to people familiar with the matter.
Yellow Freight, the largest LTL (less than truckload) carrier purchased Roadway, the 2nd largest LTL carrier several years ago.
It took forever to get the two operations merged. Also, they are union, thus quite high operating costs.
The other day their stock was around 86 cents. They are trying to restructure, but now it appears too many people have "bet" on their default, and are pushing them in that direction.
How sad.
Labels: YRC
CMA CGM still in talks on debt
CMA CGM has missed, for the second time, their targeted date for refinancing debt.
From Lloyd's List
No debt deal for CMA CGM yet
Andrew Spurrier and Janet Porter - Tuesday 15 December 2009
FRENCH container shipping group CMA CGM has again overshot its target date for completing talks with its banks on a restructuring of its $5.6bn debt.
The group, which had originally signalled a mid-November date, told its employees last month that it needed to get agreement on certain key measures by December 15.
Today, however, the group admitted ...
The rest of the article is available only to subscribers.
Back on Dec. 2nd I said I didn't expect them to meet the deadline (I had calculated mid-Dec to be latest Dec.18)
Now that we are into the Holiday season, it will be more difficult for them to achieve the restructuring. I guess it will have to wait until after Jan 1. I hope they have enough cash to get them through until then.
Labels: CMA CGM
Rotterdam Rules 2009
What has become known as "Rotterdam Rules" has the official title of:
United Nations Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea
This document is 39 pages long.
If you are involved in the actual transport of international shipments, it would be a good idea to read this document. It is not yet in effect, but probably will be in the not too distant future.
It was necessary for this agreement to be updated, to take into consideration the changes in international transportation due to containerization, which allows for, amongst other things, door to door delivery.
There is also a considerably amount of clarification regarding the bills of lading which are transmitted electronically.
Happy reading!
Labels: Rotterdam Rules
Global Ship Lease regulatory filing Dec. 9, 2009
Here's the regulatory filing referred to in the Fairplay article.
GLOBAL SHIP LEASE, INC. filed this 20-F/A on 12/09/2009This is
the part about conflict of interest.
CMA CGM is Global Ship Lease’s initial sole Charterer and its wholly owned subsidiary, CMA Ships, is Global Ship Lease’s initial Ship Manager. CMA CGM’s ability to continue to pay charterhire and CMA Ships’ ability to render ship management services will depend in part on their own financial strength. CMA CGM has guaranteed the performance of CMA Ships under the ship management agreements. As described above, the container shipping sector is suffering a severe cyclical downturn and has been incurring substantial losses. Furthermore, many containership operators, including CMA CGM, have commitments to purchase newbuildings for delivery over the next three to four years which may not be fully funded with committed financing.
Circumstances beyond their control could impair CMA CGM’s and CMA Ships’ financial strength, and because they are privately held companies, information about their financial strength is not publicly available. As a result, Global Ship Lease and an investor in its securities might have little advance warning of financial or other problems affecting CMA CGM or their wholly owned subsidiaries even though their financial or other problems could have a material adverse effect on Global Ship Lease.
CMA CGM and Global Ship Lease’s Ship Manager have conflicts of interest with Global Ship Lease and limited contractual duties, which may make them favor their own interests to Global Ship Lease’s detriment.
Conflicts of interest may arise between Global Ship Lease, on the one hand, and CMA CGM, Global Ship Lease’s initial Charterer, and CMA Ships, its Ship Manager, on the other hand. As a result of these conflicts, Global Ship Lease’s Ship Manager may favor its own or its parent company’s interests over Global Ship Lease’s interests. These conflicts may have unfavorable consequences for Global Ship Lease. For example, Global Ship Lease’s Ship Manager could be encouraged to incur unnecessary costs, for which it would seek reimbursement from Global Ship Lease. Although Global Ship Lease’s ship management agreements expressly prohibit its Ship Manager from giving preferential treatment when performing any of its ship management services to any other vessel that is affiliated with it, or otherwise controlled by CMA CGM, conflicts of interest may arise between Global Ship Lease, and its Ship Manager and its initial Charterer.
Global Ship Lease’s financial reporting is dependent on CMA CGM.
Under the ship management agreement with CMA Ships, the Ship Manager is obligated to provide Global Ship Lease with requisite financial information on a timely basis so that Global Ship Lease can meet its own reporting obligations under U.S. securities laws. CMA Ships and its parent company CMA CGM are privately held French corporations with financial reporting schedules different from Global Ship Lease. If CMA Ships or any of its affiliates is delayed in providing Global Ship Lease with key financial information, Global Ship Lease could fail to meet its financial reporting deadlines.
CMA CGM could compete with Global Ship Lease.
Along with many other vessel-owning companies, CMA CGM, currently Global Ship Lease’s sole Charterer and largest holder of its common shares, could compete with Global Ship Lease in its search to purchase newbuildings and secondhand vessels. Further, CMA CGM is not precluded from acting as an owner in the direct chartering market. While Global Ship Lease understands that CMA CGM currently has no intention of doing so, competition from CMA CGM may potentially harm Global Ship Lease’s ability to grow the business and may decrease its results of operations.
Certain terms in Global Ship Lease’s agreements with CMA CGM and its affiliates may be the result of negotiations that were not conducted at arms-length and may not reflect market standard terms. In addition, they may include terms that may not be obtained from future negotiations with unaffiliated third parties.
The asset purchase agreement, the charters, the ship management agreements and the other contractual agreements Global Ship Lease entered into with CMA CGM and its wholly owned subsidiaries were made in the context of an affiliated relationship and were negotiated in the overall context of the previously contemplated public offering of its Class A common shares in 2007, the Merger in August 2008 and other related transactions. Global Ship Lease’s agreements with CMA CGM may include terms that could not have been obtained from arms-length negotiations with unaffiliated third parties for similar services and assets. As a result, its future operating results may be negatively affected if Global Ship Lease does not receive terms as favorable in future negotiations with unaffiliated third parties or has to enter into lengthy and costly negotiations with third parties in connection with entering into such agreements.
Global Ship Lease’s growth depends on its ability to purchase further vessels, obtain new charters and maintain and potentially expand its relationship with CMA CGM. Global Ship Lease will require additional financing to be able to grow and will face substantial competition.
One of Global Ship Lease’s objectives is to grow by acquiring additional vessels and chartering them out to container shipping companies including potentially CMA CGM. This will be particularly challenging since Global Ship Lease will need to obtain additional financing in order to acquire vessels. Due to the global banking crisis and the severe cyclical downturn in the containership
So, if you are investing in Global Ship Lease stock (which I am not), please keep this in mind.
Labels: CMA CGM, Global Ship Lease
Payments to Global Ship Lease delayed
This from
Lloyd's ListCMA CGM lagging behind on payments
Rajesh Joshi - Wednesday 9 December 2009
GLOBAL Ship Lease has confirmed “increasing delays” in charterhire payments from CMA CGM, and raised doubts over the troubled French company’s ability to keep up with these payments.
GSL has also warned against the possibility that CMA Ships, which serves as GSL’s ship manager, and the rump CMA CGM have “conflicts of ...
That's all I've got. The rest is for paid subscribers, which I am not.
I presume the last sentence reads "conflicts of interest", which I have mentioned all along.
And from
FairplayGLOBAL Ship Lease confirmed in a filing today that it faces pressures on multiple fronts, including delayed payments from charterer CMA CGM.
All of GSL’s fleet is on hire to CMA CGM, which is exploring restructuring.
Again, the rest is subscription.
It refers to a filing, so maybe there is something with the SEC.
Labels: Global Ship Lease
12 Percent of containership fleet is idle
American Shipper quotes
Alphaliner on the delays in orders for new containerships
More than 300 ordered containerships, accounting for 2.4 million TEUs worth of capacity, have seen their delivery dates deferred or delayed since October 2008, according to the maritime news service Alphaliner.
But what I thought was most interesting, was the comment on current idle capacity
...the idle container fleet has hit 1.5 million TEUs, Alphaliner reported. That’s approaching 12 percent of the global fleet, a record high. That the idled fleet is rising during December is unsurprising, given that carriers are rationalizing services during the traditionally weak winter months. Alphaliner projects the idle fleet will keep rising until March.
Until the idle capacity goes away, one would think the newbuildings will just keep getting pushed back.
Of course, there are two ways idle capacity can be decreased. Ships can be chartered or, they can be scrapped.
click here for link to article
Labels: idle containerships
Why is the FDA holding up delivery of an Apple computer?
This question was posed on
BoingBoingWhy is the FDA holding up delivery of an Apple computer?
The Food and Drug Administration is holding up the delivery of MG Siegler's iMac because they apparently think it is an apple, not an Apple.
In the comments of the tracking report are these notes:
UPS (who is the transportation company, and apparently handling customs clearance) has obtained documentation and submitted to Food and Drug Administration and/or department of AG/PPQ ( which stands for agricultural plant, protection and quarantine).
There were several comments by readers of Boing Boing, wondering if U.S. agriculture/customs thought an Apple computer was in fact an apple, as in fruit.
I thought I should set the record straight. Although U.S. Customs (or now called Department of Homeland Security) does sometimes make mistakes, this was not an error.
The reason for the documentation required by PPQ (who's job it is to protect plant species in the U.S.) is because there was this nasty bug, the Asian Longhorned Beetle, which found it's way into the U.S. in packaging material from Asia. It killed a lot of trees, mainly in the Northeastern U.S.
From USDA
Asian Longhorned BeetleBackground
After the discovery in 1996 of Asian longhorned beetles (ALB, Anoplophora glabripennis) on several hardwood trees in Brooklyn, New York, the Secretary of Agriculture declared an extraordinary emergency in order to combat the infestation with regulatory and control actions. Asian Longhorned Beetles are believed to have been introduced into the United States from wood pallets and other wood packing material accompanying cargo shipments from Asia.
This is the documentation requirement. They don't inspect the shipment. They are trusting that people are not lying.
Documentation requirements
Every shipment which has solid wood packing material must be accompanied by certification from the Chinese government stating that the wood has been heat treated, fumigated, or treated with preservatives. ....
Shipments which do not have solid wood packing material must be accompanied by an exporter statement saying that the shipment contains no solid wood packing material.
I guess it's doing some good
In April 2008, both the Jersey City and Chicago infestations were declared eradicated. Currently, USDA-APHIS' Plant Protection and Quarantine (PPQ) is implementing quarantine and control strategies in New York, New Jersey, and Massachusetts that seek to eradicate this serious pest from the United States.
Labels: Asian Longhorned Beetle, FDA, PPQ, USDA
