Lack of consolidation through merger-and-acquisition (M&A) activity has been a perennial source of frustration in shipfinance, with management ego issues often portrayed as the largest stumbling block.
But a hidden obstacle sometimes complicating business combinations is the tendency of public companies to maintain burdensome management contracts with their private affiliates that can be prohibitively expensive to unwind.
Experts say the notice and buyout provisions connected with such related-party relationships can be a bigger hindrance than, for example, severance packages for management teams.
