The Rise of the Phoenix
The Rebirth of Peter Georgiopoulos
To rise like a phoenix from the ashes. An ancient saying, from the Greeks, from Christianity, the circle of life, a symbol of rebirth and eternal life. This may encompass the illustrious career of Peter Georgiopoulos.
From tabloid sensation to chapter 22. From the Wolf of Wall Street to an icon of the last heyday of shipping. A modern day Onassis, as described by his supermodel wife Kara Young on the famous New York Post Page Six ahead of their wedding day. Like many shipowners and certain real estate magnates, ‘Peter G’ had a soft spot for fashion models and leverage.
With the re-surfacing of Peter G at last falls Marine Money and after a few new investments in the sector, we felt reminiscent about the good old days, and wanted to provide a refresher for the younger generation.
But unlike the Greeks of yesteryear, an additional soft spot for public markets, and their pitfalls. Here is a look at the life of Peter G.
The story goes something like this. The young Peter not yet Peter G, in an effort to connect with the ancient roots of his family and because he was self admittedly not a particularly motivated student, went to Greece to work as a chartering assistant after graduating from college.
Having learned the ropes, but wanting more and faster, he returned to the US for business school at Dartmouth. He landed at the now infamous Drexel Burnham at exactly the time it was engulfed in controversy leading up to the eventual bankruptcy - an early look to the future perhaps.
He took the contacts and determination to be his own boss toward the Norwegian shipping market which was ripe for opportunity after tax law changes caused shipping partnerships shares to crash. Scooping up Wall Street capital as fast as he could acquire ships, the legend of Peter G was formed.
He formed an early alliance with the Oaktree co-founder Stephen Kaplan in the mid-90s, consolidating assets as General Maritime in 1997, culminating with the IPO in 2001. Genco Shipping & Trading went public in 2005 with the humble strategy:
Our strategy is to manage and expand our fleet in a manner that enables us to pay dividends to our shareholders.
Then the financial crisis hit, the commodity boom was over, asset prices cratered and the restructurings followed. Some CEOs who go bankrupt may end up in a double-wide, and this tycoon was no exception, a double-wide townhouse in Manhattan’s West Village!
From the Ashes
Every tycoon always has a bit of fight left. After the public trial of the General Maritime and Genco bankruptcies, being a tabloid paparazzi attraction it seems Peter G is making another run at glory.
“I think he’s been knocked off his pedestal,” a shipping source investor said. “He’s not a shipping giant anymore.” -NY Post, 2014
So what are his motivations? Is it merely doing what he loves? Perhaps wanting to clear the air of the past bankruptcies and mold his legacy?
With the acquisition of UACC’s 22 vessels near the bottom of the tanker market, a little early but its always tough to catch the bottom, the timing has worked out nicely. In January 2021, Scorpio Tankers was $10 dollars and change and Ardmore, the little engine that could, still started with the three! They are now $60 and $19, respectively.
“Peter Georgiopoulos takes a different view on public markets”
As reported by Tradewinds, Peter G now sees the value of private markets. Well of course you see value in private companies when you own a private company! But it would be remiss to forget, Genco had 16 vessels at IPO and General Maritime had 14 with a handful lined up to acquire (granted those vessels were a bit larger).
He has also revamped his alternative fuel and emissions ambitions, like many hungry to raise capital, with the investment and Board position at IGP Methanol, the US Gulf methanol production project.
I like the methanol angle as it is a proven technology, although it has taken some time to gain much more traction than it had a decade ago. Perhaps because the US Government is still saying things like this:
As an engine fuel, methanol has chemical and physical fuel properties similar to ethanol. Methanol was used in the 1990s but is no longer in use or being developed as a commercial transportation fuel.
But with a flurry of newbuild orders, this may be changing.
Samho Heavy Industries (HSHI) and HJ Shipbuilding and Construction (HJSC) have received $1.12bn worth of newbuilding contracts from South Korean container shipping company HMM for nine methanol-powered containerships.
Large industrial complexes are tricky, but Venture Global had a lot of success building their LNG facility in the same district as the IGP project.
The final piece of the three-pronged re-entry is Low Emission Maritime Partners, which is or had been working to develop real-time stack monitoring technology.
So Peter G is back, and regardless of motivations, striving for world peace is always a noble reason to dust off the suits and return to your day job.
The company believes that ecologically sound and safe, seaborne trade promotes world peace, supports a unique form of communication between nations and assists the development of peoples who strive to improve their standard of living.
UNITED OVERSEAS MANAGEMENT (HELLAS) LTD