Shipping companies shift focus to acquisitions, says survey

A GLOBAL survey by international legal practice the Norton Rose Group has found that the shipping industry's recovery from the downturn in world trade is sparking a significant change in the way the world's shipping companies do business.

A year ago, the Norton Rose Group survey showed most shipping companies were focused on retrenchment and raising more equity or debt. Now, their attention is on strategic acquisitions and joint ventures, it said in a company statement.

"Seventeen per cent of shipping respondents to the survey feel that recovery is already happening in their sector, a jump of eight per cent on last year. A further 14 per cent feel it will happen in the next year. The optimism could drive a flurry of activity in the next 12 months, with 60 per cent planning joint ventures and 58 per cent planning strategic acquisitions. The corresponding figures from the Norton Rose Group 2009 survey were just 25 per cent and 35 per cent respectively," it said.

The report, entitled the Norton Rose Group Way Ahead Transport Survey 2010, details the views of 679 international respondents from a range of companies involved in transport, including financiers, operators, manufacturers, governments and professional services firms. The respondents come from the aviation, rail and shipping sectors. There are 177 respondents from the shipping industry in total.

Other global shipping findings from the report include 60 per cent of shipping respondents feel incentives (eg, fiscal) are most likely to trigger a sustained investment in greener transport technologies - only 22 per cent say fines and penalties are effective.

Only 37 per cent feel greenhouse gas emissions should be the primary focus for regulatory action. Instead, companies involved in shipping supported anti-competitive behaviour as the overriding priority for regulatory effort, with 48 per cent calling for action in this area; and 34 per cent of shipping respondents feel that investment in infrastructure is the most helpful form of government support to drive their business during the recovery.

Harry Theochari, global head of Transport at Norton Rose Group, said: "Last year there was a muted reaction towards any suggestion of growth or expansion. Now, we're seeing a lot more appetite for joint ventures and even acquisitions. That's not to say that we'll wake up tomorrow to dozens of corporate tie-ups, but the door is certainly more open to more corporate activity from shipping companies."
(Source:www.schednet.com)