Our Bureau

Chennai, May 3 West Asia Maritime Ltd (WAM), the Chennai-based ship owning and operating company, has signed a $110-million (Rs 440 crore) contract with Mitsubishi Corporation, Japan, for chartering two handymax (around 55,000 dead weight tonnes) bulk carriers under ‘bare boat charter’.

Under the ‘bare boat’ charter, the entity chartering a vessel has complete possession and control of the ship, including the right to appoint its crew. Two years ago, WAM signed a similar deal for $33 million with another Japanese company, Mitsui & Co, for a bulk carrier.

The two new ships are to be delivered by Mitsubishi during the third quarter of 2012 and first quarter of 2013, Mr Abdul Qadir A. Rahman Buhari, Managing Director, WAM, told newspersons.

‘bare boat’ charter

Under the bare boat charter, WAM will pay Mitsubishi an upfront fee of 10 per cent of the total cost and the balance when the ships are delivered. Mitsubishi will also arrange finance, identify the ship building yard, and provide ships on charter to WAM, which can just focus on identifying clients for the cargo, he said.

Promoted by the Dubai-based Emirate Trading Agency, WAM and its Singapore-based subsidiaries own five handymax vessels, seven panamax dry bulk carriers and four chemical tankers.

In 2009, it will time charter four new stainless steel chemical tankers. For the fiscal ended March 2008, WAM and its subsidiaries transported 12.77 million tonnes cargo.

As on December 2007, the company’s revenues were $296 million (Rs 1,172 crore).

The current market value of its owned and ‘b are boat’ chartered vessels, and the new contract was $677 million (Rs 2,708 crore), Mr Buhari said