In Singapore, international law firm Ince & Co has advised Islamic shipping fund Safeena (L) Ltd on its first investment made through an Istisna’a and Ijarah mawsufah fi zimmah structure (a deferred purchase and forward lease arrangement) in a 19,900 dwt stainless steel chemical carrier with Jimbaran AS, a Norway-based entity which owns and operates chemical carriers.
Safeena, a joint venture between Asian Finance Bank Berhad and Amanah Investment Bank (L) Ltd, is the first shipping fund to enter into an investment using such a structure, which was arranged by RS Platou Finans.
Ince advised Safeena in structuring the investment, ensuring the transaction was Shariah compliant and that it complied with the fund’s obligations to investors. Ince also advised on the drafting of the purchase and lease documentation, its security in a sister vessel and conformity with the conventional financing arrangements in place in respect of the sister vessel.
Safeena is a private fund. It aims to raise US$300 million through equity and debt participation to invest in structures and/or acquire a portfolio of vessels.
Commenting on the transaction, Safeena chairman, Datuk Abdul Latif Abdullah said: “The structure provides an opportunity for Safeena Fund to participate in the cash flow of the underlying asset and offers an additional security arrangement through a charge on Jimbaran’s vessel.” He added that the transaction was structured to ensure that it was capable of “meeting the minimum return set for the Fund”.
Consultant Martin Brown of Ince & Co, said: “We were delighted to assist Safeena in putting together this innovative structure, which is an effective method for mitigating the risks involved for the fund and its investors. Its application may assist other sources of equity finance to invest in the shipping industry in the future.”
Ince & Co’s team, led by consultant Martin Brown in Singapore, was assisted by London partner Peter Measures and Gregory Xu, an associate in Ince & Co’s Singapore office.
Ince & Co is an international law firm with 86 partners. The Ince network includes offices in Dubai, Hamburg, Hong Kong, Le Havre, London, Paris, Piraeus, Shanghai and Singapore. The firm?s lawyers practise English, French, German, Greek, UAE and Hong Kong law. We also advise on Singapore law in arbitrations. Ince Singapore has three partners; Richard Lovell, Simon Spark and Elliot Woodruff. Martin Brown is a consultant in the Singapore office.
Ince & Co is the current holder of the Asia Law Leading Lawyers Survey, Leading Lawyers in Shipping, Maritime and Aviation 2009 award and Seatrade Asia Maritime Law Award 2008.
Lawyers in the firm advise in the core business areas of aviation, business & finance, commercial disputes, energy, insurance & reinsurance, international trade and shipping. Our teams regularly use knowledge of one sector to advise clients in another.
Ince & Co?s ship finance practice is involved in all aspects of asset financing for global shipping and off-shore oil industries, acting for both borrowers and lenders. The practice encompasses the acquisition of newbuildings and the sale and purchase for trading or scrap of second-hand tonnage and all aspects of financing: structured and syndicated financing, primary and bareboat registration, refinancing and workouts and related advisory work.
