Wilbur Ross-backed Navigator Holdings shares rise 11 pct in debut

Reuters

Nov 21 (Reuters) - Shares of liquefied gas carrier NavigatorHoldings Ltd, controlled by billionaire investor WilburRoss, rose as much as 11 percent in their debut, valuing thecompany at about $1.15 billion.

Navigator raised $228 million after its initial publicoffering was priced at $19 per share, the top end of itsexpected price range.

The company's shares were trading at $19.88 on the New YorkStock Exchange, after touching a high of $21.12.

Navigator owns and operates the world's largest fleet ofhandysize tankers, with a deadweight of up to 50,000 tonnes,that transport a range of liquefied gases, including liquefiedpetroleum gas (LPG), petrochemical gases and ammonia.

It competes with Athens-based StealthGas Inc, Tokyo-based Nippon Yusen KK, Belgium-based Exmar NV and Norway-based Solvang ASA.

Navigator was previously controlled by Lehman BrothersHolding Inc, which sold its entire 44 percent stake in thecompany to Ross for $110 million through a bankruptcy court lastyear. Ross raised his stake in Navigator to 60.6 percent.

Ross, whose company WL Ross & Co manages around $10 billionin assets, made a name for himself as a bankruptcy specialist,snapping up out-of-favour assets ranging from banks and textilesto steel and coal firms.

Ross has been betting on the shipping sector, which is in anextended downturn since the global economic crisis of 2008, andalso owns a part of privately held Diamond S Shipping.

Ships ordered before the recession hit the seas just asdemand collapsed, leaving shippers to cope with rock bottomfreight rates even as bunker fuel prices soared.

However, a small group of shippers, including NavigatorHoldings, are beginning to benefit from the U.S. shale boom,with demand picking up for vessels that can transport theby-products of oil and gas production.

SHALE BOOM BENEFITS

Navigator Holdings, which has 23 vessels on the water, expects increased exports of LPG out of the United States.

The surge in U.S. shale oil and gas output has resulted inan abundance of LPG and given the scarcity and cost of storageinfrastructure, large quantities of LPG are being transportedoverseas.

Navigator Holdings is also seeing increasing movement ofpetrochemical gases, which are derived from processing oil andgas products.

Higher refining and chemical plant capacity in the MiddleEast and Asia is pushing demand for vessels that can transportpetrochemical gases -- used in plastics, organic chemicals andrubber.

Navigator Holdings, established in 1997, said it intends touse proceeds from the offering to buy more vessels.

Of the 12 million common stock sold, Navigator offered 9.03million shares, while the rest came from the sellingshareholders. It had planned to offer 11.3 million shares.

The company's net income rose to $30.1 million for the ninemonths ended Sept. 30, 2012 from $21.7 million a year earlier.Operating revenue rose about 57 percent to $167 million.

Jefferies and Morgan Stanley were among the leadunderwriters for the IPO.

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