Greek shipowners George and Christos Economou are being taken to court in New York by interests behind US equity firm MatlinPatterson for allegedly obstructing the sale of four LNG carriers.
Oceanus LNG, which is 85.7% owned by MatlinPatterson, said in a filing this week with the Supreme Court of the State of New York that it holds the two men accountable for their “unrelenting campaign” to “sabotage” Oceanus’ sale of the four vessels worth hundreds of millions of dollars.
“Through brazen acts of intimidation, insubordination, and borderline piracy, the Economous have deliberately interfered with Oceanus’s pending sale in numerous ways, including by illegally encumbering its ships, impairing their revenue, and interfering with potential buyers,” the court document states.
“The Economous have only a single goal in mind: to destroy the value of Oceanus and its ships so that [MatlinPatterson], and its secured lenders, have no choice but to sell the company or its ships to the Economous.”
Oceanus and MatlinPatterson are seeking to recover “substantial damages” from the pair of not less than $100m.
George Economou indirectly owns 14.3% of Oceanus and serves on its board of managers. The ships are managed by companies controlled by George and Christos Economou, who control TMS Cardiff Gas.
The ships referred to are the 160,000-cbm, tri-fuel diesel-electric (TFDE) Corcovado LNG, Kita LNG, Palu LNG and Yari LNG (all built 2014).
Oceanus paid nearly $900m for the ships, which have been on-off sales candidates in the market for several years.
The company put the Corcovado LNG up for sale in March, after lenders refused to provide relief from debt covenants put in place by George Economou that he was unable to service.
Potential buyer
Shipbroker Affinity (Shipping) was appointed exclusive broker for the sale.
But Oceanus said that while the Economous agreed to the sale, the pair “pressured numerous potential bidders to stay away and ultimately prevented any sale from being completed”.
It also accuses the duo of fixing the Yari LNG on long-term charter at a below-market rate, against the board’s directions.
The filing details that in October, an offer was received for all four LNG carriers from “one of the world’s largest LNG shipping companies”.
But the Economous are said to have blocked the buyers from receiving information about the ships.
On 1 December, George and Christos sent Oceanus an offer to buy the vessels at a lower offer and said Oceanus would need to obtain financing for the purchase, the filing states.
Two days later, Oceanus’ board voted to strip Christos Economou of all duties and authority over the company.
But the filing said that on the same day, the father and son chartered out the Corcovado LNG for three years at $40,500 per day, which Oceanus described as “a fraction of the prevailing market rate” and a move that cost it millions of dollars in lost revenue.
Rates for TFDE LNG carriers are currently being quoted at close to $150,000 per day.
Oceanus argues that the charter gave the Economous control over the vessel for the charter period and impaired the ship’s market value.
“The Economous may have destroyed the pending fleet sale,” it said.
