Another Win for Navios in Vale Contract Dispute
A New York arbitration tribunal has ruled in favor of Navios South American Logistics, part of Greek dry bulk shipping company Navios Maritime Holdings, on a dispute with Vale International S.A. regarding the termination date of a contract of affreightment.
In line with the ruling passed in February, Vale has been ordered to pay Navios Logistics USD 21.5 million, compensating for all unpaid invoices, late payment of invoices, and legal fees incurred, Navios informed.
The decision comes two months after a London arbitration tribunal ruled the 20-year contract between Corporacion Navios S.A. and Vale for the iron ore port under construction in South America to be in full force and effect.
“We are pleased that we have removed the uncertainty regarding our iron ore port in South America. The London arbitration tribunal has ruled in favor of Navios Logistics – that the Vale 20-year port services contract remains in full force and effect. The Vale minimum guarantee, for 4 million of the 10 million tons of annual capacity, should generate about USD 35 million in annual EBITDA. Over the 20-year term of the contract, this minimum guarantee should generate about USD 1 billion in EBITDA,” Angeliki Frangou, Chairman and Chief Executive Officer, said.
Separately, the group informed that its Navios Holdings has agreed to sell to Navios Partners certain loans previously funded by Navios Holdings to Navios Europe Inc. for USD 27 million.
Navios Holdings reported a net loss of USD 75.8 million for the year ended December 31, 2016 down from USD 134.1 million loss posted in 2015. For the fourth quarter of 2016, the company’s net loss totaled USD 14.4 million, also considerably down from USD 60.6 million reported in the corresponding period from 2015.
“Navios Holdings is positioned to capture any market recovery. In 2016, we reduced expected 2017 breakeven by USD 28 million through a number of actions, including purchasing, at a discount, about USD 60 million in face value of our unsecured bonds and USD 61.1 million of par outstanding Series G and H ADSs. We also reduced the average charter rate for our charter-in fleet by USD 2,170 per day and cash requirements for servicing commercial bank debt. Our scale provides industry leading operating efficiencies, with Opex about 37% below industry averages and G&A among the lowest of our publicly listed shipping peers,” Frangou added.