Low-key hedge fund-controlled shipowner Novellas Union has won the release of a product tanker arrested in Texas as part of an arbitration battle over unpaid fuel bills of $1.5m.
The 46,300-dwt Port Union (built 2003) was released and sailed on 27 October after a brief arrest in the port of Beaumont by London-based Integr8 Fuels.
The $1.5m claim in the Eastern District of Texas federal court was based not only on the Port Union’s fuel bills but also those of its STX-built sistership, the 46,200-dwt Port Said (built 2003), and the CSSC Offshore Marine Engineering-built, 38,900-dwt MR1 tanker Port Stewart (built 2003).
Debi Laurent, Integr8’s in-house counsel, declined to comment on the voluntary dismissal of the arrest lawsuit, citing a confidentiality agreement.
New York arbitration
But Integr8’s legal filings indicate that, subsequent to the arrest, the company intended to bring a New York arbitration under the rules of the city’s Society of Maritime Arbitrators.
Germany and UK-based Novellas Union, which is led by managing director Thomas Bindseil, is described in legal filings as a joint venture of London-based Union Maritime and Hamburg’s Novellas Maritime.
Officials at Union Maritime, Novellas Maritime and related companies did not respond to a request for comment before TradeWinds went to press.
Novellas Union is commercially managed by a German subsidiary of UK company Union Commercial Services, which is also headed by Bindseil.
Novellas Maritime is controlled by US private equity investment fund Apollo Global Management. The fund has a low profile and its ships and executives are not listed on Union Maritime’s website, but Bindseil and others can be reached through the London-based company.
The physical supplier of the Port Union was Aegean Marine Petroleum, whose bankruptcy TradeWinds reported this week.
However, legal officials at Integr8 Fuels told TradeWinds that Aegean’s involvement in the transaction played no role in the arrest.
Documents filed by the bunkerer indicate that the Novellas Union joint venture operations have struggled to make fuel payments, despite the deep pockets of their owners
Documents filed by the bunkerer indicate that the Novellas Union joint venture operations have struggled to make fuel payments, despite the deep pockets of their owners.
Integr8 officials cited Bindseil as explaining in late September that he was waiting on charter hire income to fund a partial payment of the fuel bill, which Integr8 applied to unpaid interest. Further charter hire instalments were to have funded other bunkering payments.
“Those promised payments, however, were never received by Integr8 Fuels,” the lawyers told the court in asking for the arrest order.
The Novellas Union fleet consists of ships acquired in 2014 by Apollo in a deal reportedly worth $200m. It included all but one of the 15 ships then in the managed fleet of Germany’s Stella Marine Services. Many or all of the vessels remained under Stella technical management after their purchase.
But Apollo’s enthusiasm for the ships did not last, and the mixed fleet of vintage bulkers and tankers has gradually been sold down from 14 to seven at the beginning of this year — and now to five.
Although court papers describe Novellas Union as the joint venture owner of the fleet, another entity, Novellas Maritime Beteiligungs, describes itself in a consolidated financial statement for 2016 as the holding company that controls the vessels, with administration in the hands of minority shareholder NAVES Corporate Finance.
NAVES, now a division of Breamer Shipping Services, sold its shares in May 2017.
The report — made available through the lawsuit — indicates that, at the time of reporting, Novellas Union had just succeeded in selling off all but one of its cash-bleeding bulkers, which had given it a negative bottom line since the 2014 purchase.
Subsequently in April 2017, it sold the 37,800-dwt MR1 tanker Port Louis (now Prima Tangguh LVI, built 2002) to Indonesia’s Soechi Lines for $6.7m.
In March this year, it sold its last bulker, the 53,300-dwt supramax Santa Margherita (now Evanthia, built 2005), for $8.7m to Vulcanus Technical Maritime Enterprises of Greece. The following month, Novellas Union sold the Port Louis’ sistership, the 37,800-dwt Port Russel (now P Russel, built 2002), for an unknown price to South Korea’s Petra Trading Co.
That leaves the company with four South Korean-built MR2s, plus one Chinese-built MR1, all constructed in 2002 and 2003.
According to the report for 2016, Novellas Maritime’s directors include Dr Thomas Bister-Fusser, Braemar NAVES Corporate Finance managing director Axel Siepmann, Lapithus Management chief executive Eugene Kyim, and Apollo partner and Principal Maritime Management chief executive Arthur Regan.
Siepmann left Novellas Maritime N Holding in late 2016.
Braemar Naves Corporate Finance (formerly Naves Corporate Finance) holds neither any interest nor any management role in Novellas Union, the company said in a statement to TradeWinds.
This article has been updated since first publication to reflect new information on the involvement of Axel Siepmann and NAVES.
