A major theme of Dynasties of the Sea is the increasing role of private equity as a source of financing in shipping. This theme is supported by a recent editorial “Can Private Equity Save Shipping?” in the November-December 2012 issue of The Maritime Executive. The article mentions Dynasties interviewee Wilbur Ross as well as the late Larry Tisch, whose son James is also featured in the book. It even includes a nod to The Shipping Man, which is also published by Marine Money.
How long will the PE window stay open? As long as the market remains depressed, say all the experts, and most agree it could get worse before it gets better. Meanwhile, the pressure is building on all sides. How long can owners hold out with low rates and high operating costs before they file for Chapter 11 or hold a fire sale? How long can the banks hold loans that are technically in default but have been granted one covenant waiver after another – a practice Peter Shaerf dubs “extending the runway”? And how long can private equity firms wait while sitting, according to a recent article by Andrew Ross Sorkin in The New York Times, on $1 trillion in uninvested funds? Yes, that’s trillion with a “t” in dry powder that they need to invest before time runs out and they have to return it to their investors. Expect to see more deals in the future and at a faster pace than ever before.
Andrew Ross Sorkin, cited in the excerpt above, also co-anchors CNBC’s “Squawk Box”, the series Dynasties of the Sea author Lori Ann LaRocco executive produces.