Dee4 Capital Partners, chaired and co-founded by former Norden and BW Group CEO Carsten Mortensen, presents a large profit from private equity fund with its portfolio of product tankers. Investors receive major dividend payouts.
Former CEO of Norden and BW Group Carsten Mortensen has managed to ensure a large profit in Dee4 Capital Fund I last year despite the squeezed tanker market, according to the annual report of Dee4 Capital Fund I, just published via the Danish Central Business Register.
The fund, established in 2019 by 20 investors bringing capital of USD 72m, owns a fleet of five MR tankers.
According to the report, the fund saw an operating result (EBITDA) in 2021 of USD 10.8m against USD 13.8m in 2020.
The fund’s EBIT comes to USD 9.3m against USD 4.3m in 2020, with the net result at USD 7.5m against USD 2.5m in 2020. This despite last year’s strained product tanker market, where several tanker shipping companies incurred major losses.
Our investors saw reasonable returns on their investments, and our portfolio is looking promising in 2022
Carsten Mortensen, founding partner, Dee4 Capital Partners
”We are satisfied with the result of USD 7.5m in 2021. A year when tanker markets were under pressure. Our investors saw reasonable returns on their investments, and our portfolio is looking promising in 2022 with the improved freight rates,” writes Carsten Mortensen, founding partner at Dee4 Capital Partners, in an email to WPO.
”Fund I has acquired ships at a historically good price, and furthermore, we sold the fund’s two oldest ships during fall.”
According to the report, Mortensen’s capital fund sold two ships and bought one in 2021 – and after write-offs and write-downs, the five MR tankers have a book value of USD 88.5m as of the end of 2021.
The five MR product tankers in Dee4 Capital Fund I are working on a time-charter basis or in carrier Hafnia’s MR pool, according to Mortensen.
Besides Dee4 Capital Fund I, Mortensen’s private equity company, Dee4 Capital Partners, also manages co-investments alongside two other co-investor groups that have invested in seven other MR tankers.
The seven vessels have been placed in investor groups E4C (with the Ecco family and Gunvor Group as investors) and H4, which is associated with Helikon.
Three of the five ships in H4 have been chartered out on contracts with Stena and Weco.
In E4C, the two MR product tankers are on charter with Clearlake on long-term contracts.
USD 22m in payout
In its report, Dee4 Capital Fund I writes that the tanker market has become more volatile on account of the war in Ukraine, which has been invaded by Russia.
”Prior to the invasion of Ukraine, the product tanker market was already recovering. At the time of writing, it has even become quite strong, which we are well positioned to benefit from,” Mortensen says.
”There will be a limited supply of new product tanker tonnage in the coming years as many container, dry bulk and LNG vessels are being built, which is why we are cautiously optimistic. We have had a very fine start to 2022 and expect an overall satisfying result in 2022.”
Last year’s positive results from Dee4 Capital Fund I prompts the fund to pay out USD 22m to investors, according to the financial report.
