Norway's Stolt-Nielsen is teaming up with German owner John T Essberger Group to run small chemical tankers in Europe, as consolidation continues to sweep across the sector.
The Stolt Tankers unit and the Hamburg company will combine their parcel tanker fleets from 1 January.
The new company — E&S Tankers — will manage 48 ships ranging in size from 2,800 dwt to 11,300 dwt.
They will focus in particular on the Baltic, Mediterranean and north-west Europe areas.
Stolt Tankers president Lucas Vos told TradeWinds that talks began in the summer at the instigation of Essberger.
"They wanted a broad conversation to see if we could cooperate and it was a quick conclusion that this was the best thing to do," he said. "It was a good and smooth process."
Hamburg operation
E&S Tankers is subject to being granted clearance by German competition authorities. This is expected to happen in December.
Stolt-Nielsen staff have two weeks to decide if they want to transfer from Rotterdam to Hamburg, where the new operation will be based.
The company told TradeWinds: “Unfortunately, this joint venture may involve a small number of redundancies as the new venture will eventually be managed out of Hamburg, Germany.
“We are having discussions and working closely with those affected about possible relocations and have asked for their initial response within 14 days.
“We recognise this is a challenging time for those affected and are offering full support to our employees during this period.”
Market leader
Vos described Essberger as the market leader in the smaller vessel size.
"Looking at our flows, we have complementary business," Vos said. "We both have ballast voyages, but going in opposite directions, so there is scope to reduce emissions that way."
As for future expansion, Vos said investment in the petrochemical business is relatively flat in Europe, compared to that seen in the US, China and the rest of Asia.
"It's not clear how this business area will grow but, if you look at the number of players, I think it is a good time to have consolidation," he said.
"I see this as a first step, so let's prove that this works, and then other parties will be welcome to join."
Vos said the Essberger combination was a deal in isolation and there are currently no conversations taking place about tie-ups for the company's bigger ships.
"We are continually looking to improve our deepsea operations," the executive said.
Vos added that E&S Tankers will provide enhanced reliability, logistical flexibility, and minimise network inefficiencies.
Costs to be saved
"Most importantly, I expect the newly formed joint venture to deliver significant cost savings," he said.
Stolt-Nielsen is adding in 14 ships, while the other 34 come from the German owner, representing its entire tanker fleet. Essberger also owns three containerships.
Stolt said earlier this year that it wanted to drive consolidation through pool agreements.
"Essberger and Stolt Tankers are strong heritage businesses with a very good match in their values and business approach," Essberger managing director Jan Eghoj said.
"With this joint venture, we have combined our vast experience in the parcel tanker market for the benefit of our customers."
Eghoj said improved fleet efficiencies will enable the company to invest in its future.
The move is another indication of growing consolidation and cooperation in the chemical carrier market.
Last week, Norwegian rival Odfjell launched an MR chemical tanker pool with Navig8, before quickly adding seven Transportation Recovery Fund ships to bring the total to 19 vessels.
Chembulk, Team Tankers, Womar and Maersk Tankers have all also been involved in cooperation deals this year.
