Best Oasis made its name as a cash buyer in the recycling sector but for the past two years, it has been building up its own Dubai-based shipping company, SPM Shipping, amassing a fleet of 12 tankers, bulk carriers and large anchor-handlers.
SPM was founded in 2022 and went on a buying spree in 2023, purchasing eight ships. This year began with deals for two more vessels. But that could be it for now.
Fleet technical manager Merwyn Pinto said on the sidelines of a TradeWinds’ shipowners forum that the company has no intention of replicating last year’s pace of vessel acquisitions in the coming months.
“We’ve been pretty aggressive, but at the same time we are also trying to grow progressively,” Pinto said.
“Although we are still aggressive, and we are in the market looking, we’re not very keen to buy vessels because we can see that it’s becoming more and more difficult as the prices are coming up,” he said.
“When the market is going down and vessels are at a much-discounted rate, that’s when we are looking to buy. Beyond that, it depends on the future growth prospects for a specific market.
“When we are to buy a ship, we need to have the market and we need to have the business. When we have the business, we do our calculations and strategically make a decision on whether to buy or not.”
Pinto stressed that despite the recycling sector links of SPM’s shareholders, the company is not interested in old ships that it can squeeze some profits out of for a couple of years before scrapping.
The preference is for ships of 14 to 18 years old, which Pinto says still attract quality charterers provided they are well maintained.
Tanker focus
SPM’s fleet comprises five MR2 product tankers, a bunker tanker, a capesize bulker, a handymax bulker and four large anchor-handlers.
VesselsValue puts the average age of this fleet at 17 years and estimates its market value to be about $190m.
According to Pinto, the company has a mixed trading strategy, fixing ships on spot and long-term charters.
The bulkers and tankers trade internationally, with Oldendorff Carriers, Athena Shipping and Champion Tankers said to be among its clients.
The anchor-handlers work in the Indian offshore sector and are managed out of Mumbai.
SPM has assigned the technical management of its ships to well-known international ship managers such as Synergy Marine, Pinto said.
While the tanker sector has been the company’s main investment market to date, from the outset its business model has called for it to have a presence in the wet and dry sectors.
Pinto said that maintaining a foothold in each allows it to have the expertise to ramp up its footprint in either sector as or when market fundamentals look promising.
For now, he added, tankers are SPM’s focus and while keen on capesize bulkers, he concedes prices are a concern.
Popular move
SPM is one of several shipping companies set up by larger players in the ship recycling sector.
US-based GMS started the trend in 2006 when founder Anil Sharma partnered a Monaco-based shipowner to buy two handymax bulkers. This laid the foundation of what would become Lila Global, a shipping company based in Dubai with nearly 40 vessels.
Wirana Shipping Corp launched its shipowning arm in February 2023, buying a 15-year-old VLCC from US-listed Navios Maritime Partners. Today, VesselsValue lists the company as owning three VLCCs.
Individual partners in the Singapore-based cash-buying companies have previously dabbled in shipowning. Several other cash buyers and ship recyclers are also known to own vessels.
Sharma told TradeWinds in 2022 that owning operating ships allowed him to keep smiling at a time when activity in the ship recycling sector was at a near standstill.
SPM differs from Lila Global in that, so far, it has shown little interest in asset plays, acting purely as a buyer, whereas Lila Global has been quick to take advantage of rising asset prices.
