Shipping major BW Gas eyes IPO, listing in Singapore or Hong Kong: sources

One of the world's largest operators of gas carriers, BW Gas, is planning an initial public offering and a listing on either the Singapore or Hong Kong bourse as it moves to capitalize on the rapid growth of the LPG market driven by the US shale gas boom, industry sources said Wednesday.
The company was first listed in Oslo in October 2005 as a pure gas shipping company, with parent BW Group retaining a majority share.
BW Gas was re-privatized in 2009, and sources said the Oslo-based company is now looking to list again, either in Singapore or Hong Kong, though the amount of funds it aims to raise was not immediately known.
"BW regularly assesses its global business portfolio and an IPO is one of various corporate actions that we consider from time to time," Lisa Lim, its manager for communications and brand, said when asked about the plans. "It is our company policy not to comment on market speculation."
Lawrence Wong, Head of Listings at Singapore Exchange, said SGX is the preferred venue for capital raising by companies seeking to establish a regional or international presence, but does not publicly comment on specific firms.
A Hong Kong Exchange spokesman said: "If a company has IPO plans, HKEx does not announce them on the company's behalf."
BW Group has committed to buying four Very Large Gas Carriers from South Korea's Hyundai Heavy Industries, the Bermuda-registered company said last month, as part of its fleet-renewal plan and in line with the recent surge in vessel buildings and acquisitions in the sector.
The VLGCs, each 84,000 cubic meters, will be delivered between fourth quarter 2014 and second quarter 2015, the company said. It declined to disclose the price of each vessel, but shipping analysts estimate a new-build price for a VLGC at around $71 million.
"BW has six VLGCs on order, which will be costing around half a billion dollars," a Singapore-based ship sales and purchase broker said. He was referring to the four new-builds on order with HHI, plus two more on options.
"Maybe they feel there is a good opportunity to go in for an IPO and raise the capital to finance the new builds," he said, adding the bigger gas tankers offer shipowners a time charter equivalent of more than $50,000/day. ACTIVITY RISING IN LPG MARKET
BW Group in May bought Maersk Tankers' five owned-vessels and took over the five existing time-charter commitments in a move to boost its share in a market set to grow 5%/year through 2016 with the rise in US exports as the expanded Panama Canal opens and Middle East supply increases. The increased activity has pushed VLGC rates up by around 80% so far this year.
This also marked the exit of Maersk Tankers from its VLGC segment, the Danish shipping giant had said.
"They have great expertise in the gas tanker segment. Normally their ships are fixed at top dollar. They are known for trading their vessels pretty well," the sales and purchase broker said.
BW, which is also based in Singapore, had said its acquisition of liquefied petroleum gas vessels was aimed at providing ready access to vessels in all regions at all times.
With BW's latest orders at HHI, the industry has seen at least 45 orders for new-builds, or older ships acquired this year and last year, not including recent activities in the second-hand market, according to data compiled by Platts.
The group currently owns, part owns or controls a combined fleet of 93 vessels, of which 23 are VLGCs, five large gas carriers, three medium gas carriers and 17 LNG tankers.
The other tanker segments that BW has a presence in are the Very Large Crude Carrier market, which is currently languishing under a chronic tonnage oversupply, and the Long Range I product tanker sector, which is seeing a pick-up in freight levels on the steady availability of long-haul voyages for moving refined petroleum products.
Another unit, BW Offshore, which acquired Prosafe Production in 2010, has been listed on the Oslo Stock Exchange since 2006 and is the world's second-largest owner and operator of floating, production, storage and offloading, vessels. Other units in the group are BW Maritime and BW Ventures.
Source: Platts