Gearbulk, Grieg Star battle bulker blues with joint venture

Swiss and Norwegian owners teaming up to run combined dry cargo fleet of more than 130 ships.

Switzerland's Gearbulk and Norway's Grieg Star are to set up a new bulker joint venture.

The company will operate the owners' combined fleet of more than 130 open hatch, semi-open hatch and conventional ships.

Gearbulk will have 65% of the venture, and Grieg Star 35%.

"We see our two operations as complementary, making this joint venture a natural next step for our companies. In an increasingly competitive market, we believe this new entity will have the size to build and sustain a versatile and independent shipping service," said Grieg Star CEO Camilla Grieg in a statement.

She later told TradeWinds the move was a few months in development and was "overdue".

“We live in a global world and our customers have been getting bigger and bigger for decades,” she said.

“By joining forces we can serve them in a much better way. It’s extremely competitive out there.”

The name of the joint venture is yet to be decided. It will be established as an independent Norwegian company with headquarters in Bergen, Norway, and offices worldwide.

Rune Birkeland, 61, CEO of Grieg Logistics, will be CEO and Arthur English, 48, Gearbulk's commercial managing director, will be the chief commercial officer.

The board will be composed of three directors appointed by Gearbulk and two by Grieg Star, with Kristian Jebsen as chairman.

It is intended to be fully operational through the first half of 2017.

Customer-focused integration

"This agreement represents the firm intention of both companies to build an improved range of services for our customers. The combined number of vessels and trades will make it easier for our customers to find services that fit their needs," said Kristian Jebsen, chairman and CEO of Gearbulk.

Grieg Star chair Elisabeth Grieg added: "The talks and cooperation throughout this process have built an invaluable trust and confidence between the parties. The two companies both have strong corporate cultures and values, and we aim to take the best from the two, and merge them into one strong, customer-oriented culture."

Existing contracts will be honoured, while the two owners will retain their independent technical ship management and vessel ownership in interests.

The venture excludes Gearbulk ships operated with other third parties, as well as terminals, transhipment operations, caustic bulkers and tankers.

Grieg Star's terminal businesses will also remain outside the scope of the new entity.

Gearbulk usually operates between 85 and 90 open hatch and conventional bulkers, while Grieg Star has about 45 owned or chartered open hatch, semi-open hatch and conventional bulk vessels.