Alternative Financing

The answer to financing needs also creates complex ownership interests with many beneficial owners 

Joint Venture Financing 

Joint ventures act as alternative sources of finance for capital acquisitions, the lender becomes an investor. Shipping JVs tend to be established for a very specific purpose. 

 We advise shipowners to access funds available from private investors through the use of joint ownership venture, finance lease, or structured financing transactions where investors can take junior and subordinate positions. 

Unlike joint ventures in other 'non-specialist' sectors, the control and management of a shipping joint venture will not be linked to equity contributions, but almost always vest in the shipping company being funded, or designated vessel operators, which are often a subsidiary of the shipping company.  On top of the absence of control, shipping JVs sometimes do not come with vessel ownership either. 
Fareya Azfar has aided many ship owners and third party investors in forming new shipping joint ventures to invest co-invest in newbuilds and second hand vessels.

Leases

A lease arrangement is one means of financing the acquisition of a vessel.

  • leveraged and synthetic leasing arrangements, which allows  financing the acquisition of vessels partly through traditional bank loan, and the remainder from the initial deposits taken from the long-term finance lease of the ship. 
  • utilize a bareboat charter party as the vehicle for the loan repayment agreement.