Danish offshore wind ship player Cadeler has been vindicated on its cautious stance on the US market.
Chief executive Mikkel Gleerup told TradeWinds that over the past couple of years the BW-backed company did not believe the balance of risk and reward was right across the Atlantic.
“I think also a lot of people thought that that was the wrong decision. But I think that now, fast forwarding to today, it was the right one,” he said.
Some developers in the US began tearing up or renegotiating offtake deals, putting vessel demand into question.
“We didn’t have an exposure when everything blew up in the US and now where things are normalising again, we see a lot of support actually in the American market,” Gleerup added.
Now the Oslo and New York-listed company has secured a US contract and will be working there this year.
However, no details are being released currently.
“We are looking at this market on a case-by-case basis and I think that that has been the right strategy for us, and hence the project that we will be embarking on this year is for us the right risk and reward balance, and in a partnership with our clients,” Gleerup said.
The company merged with Scorpio Group’s Eneti in December and has four wind turbine installation vessels operational, and seven on order.
Gleerup told TradeWinds it is always hard to assess whether capacity will be sufficient.
Talking to clients
But Cadeler certainly will not have too many ships, he said.
And he explained that continuous engagement with clients is vital.
“The benefit we have is that we have a relationship-driven organisation and we want to make sure that we discuss with our clients, so we have certainty that the moves we make are not speculative but very much balanced with the view our clients have and the view we have,” he said.
The company has had “massive interest” in financing from lenders for the newbuildings, closing funding for the first two P-Class ships last year.
“In that financing we had 11 international banks involved and we were 100% oversubscribed,” Gleerup added.
“We had to scale the banks back and we see the same level of interest for the follow-on vessels, so we are very confident on the debt,” he said.
The group has also fixed €80m ($87m) of unsecured loans with HSBC.
“I think that is also remarkable. I don’t think that shipping has ever been able to do that before and I think that’s really a testament that we are able to do that with a large international bank. It means there is great confidence in what we are doing,” Gleerup added.
Cadeler has also “harvested” about €25m in annual synergies.
“That is due to the refinancing of any facilities where we are able to get better terms and conditions, better covenants, but also better rates. For us it’s all about delivering these vessels on time and on budget,” Gleerup concluded.
