(Adds CEO, detail)
OSLO Jan 11 Tanker firm Frontline 2012 , controlled by shipping tycoon John Fredriksen, has raised $310 million in a private share placing to finance plans for further new investments, defying the depressed state of the shipping market.
The loss-making company, whose shares are traded on the Norwegian over-the-counter (OTC) market in Oslo, was spun off from Frontline in 2011 in a move to re-finance operations as a global glut of crude tankers keeps rates and fleet utilisation low, and substantial scrapping is needed before there is hope of a balance between supply and demand from the crude industry.
In spite of the over-supplied tanker market, the firm has committed to newbuilds and aims to be one of the major players in liquefied petroleum gas (LPG) shipping within years.
It said on Friday the new investments included "significant further contracts which are currently at an advanced negotiating stage or can be exercised through existing option agreements," as well as the earlier announced newbuild contracts for four Capesize and four VLGC (very large gas carrier) vessels.
"These are ships we already have on contract and we have additional options and are working with additional shipyards on this matter," said Frontline 2012's chief executive Jens Martin Jensen.
"We're looking at several segments going forward, both dry bulk and gas vessels," he added.
Frontline 2012 owns six VLCCs (Very Large Crude Carriers) and four Suezmax tankers.
As of Nov. 28 Frontline 2012's newbuild programme comprised 16 newbuilds within the crude oil and petroleum product markets, out of which four are VLGCs and four VLCCs. (Reporting by Victoria Klesty and Joachim Dagenborg; Editing by Greg Mahlich)