Private Equity in at König

May 22, 2013



Private equity in at Konig

Two US private equity firms have come to the rescue of cash-strapped German KG house, Konig& Cie.

Tobias Konig
Tobias Konig

Dallas-based Delos Shipping and Tennenbaum Capital Partners of Los Angeleshave taken an 80% chunk of the company in a move that will see Tobias Konigand Jens Mahnke retain a 20% stake and stay on as managing directors.

Konig & Cie did not reveal the size of the investment but said the entireamount has been used to “settle, restructure or waive all of the company’sliabilities”.

The company has been fighting for survival since the shipping crisis hit andhas slashed its headcount from 140 to 60 in order to cut outgoings to EUR10m ($13m) per year.

“As a consequence of the financial crisis in 2008 and the subsequent collapseof the shipping and KG markets, Konig & Cie. entered into a moratorium withits creditors and commenced a restructuring process,” it said today in astatement.

“The company changed its business model from a large retail-focused KGhouse to a small investment boutique and asset manager focused on theshipping sector and its investments including, Konig & Cie, Scorship Navigationand Marenave Schiffahrts.

“Konig & Cie. has a unique international network in the shipping and offshoresector and has been a partner to successful international shipping companiesfor many years.

“As such, Konig & Cie. was identified by Delos and Tennenbaum as an ideal platform for further investments in theshipping sector which offers attractive opportunities for investors focused on distressed assets.”

Konig & Cie. will continue to manage the assets of closed end funds issued in previous years while cultivatingrelationships with institutional investors and expanding its presence in the shipping sector, it said.

Tobias Konig will remain CEO of Marenave Schiffahrts and Hamburg-based activities such as Trustee and Shipmanagement would be consolidated and new investment opportunities actively pursued.

Brian Ladin, founder of Delos Shipping said he had been attracted by Konig & Cie’s broad involvement in theshipping industry.

“I have known Tobias for a number of years and have been impressed by his shipping expertise and huge network,”he said.

“Coming to Hamburg to buy the Konig & Cie. container vessels, I realized that there was an excellent opportunityfor us to invest in a broader shipping platform.

“The biggest advantage we have seen is that Konig & Cie. is not just focused on one narrow segment but offers awide range of expertise across the ship financing sector.

“Based in Hamburg, Konig & Cie. is in the center of the ship finance industry, and has great contacts with manylenders and a proven track record of successfully acquiring and restructuring shipping assets."


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