07 de Diciembre de 2019| Última actualización 08:56 GMT

German company formulates plan to rescue KG schemes in shipping industry

editor | 07 Octubre del 2009

In troubling times for the shipping industry, when ship values have collapsed and employment in the sector faces an uncertain future, the German owner/operator W-O is stepping in to save at least some of the KG (limited partnership) ownership schemes. The German company is a long-term participant in the KG tanker market, and has proposed a “quite simple, yet revolutionary” solution that will require collective effort and long-term planning, involving selling off a few loss-making vessels and acquiring viable loan facilities for others.

The KG system ran into difficulties when it became obvious that banks had based their loan conditions on assets and performance at the time, without taking risk into account. With the sharp drop in the value of shipping assets and contracting busienss under the financial and economic crisis, the conditions on which the KG scheme was based were wiped out and replaced by far less favourable circumstances.

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