December 2020 | Our partner area2invest talked to Patrick Schütze, Managing Director of neoFIN GmbH, about impact investing and the Green Ship Token as a green deal. Read extracts here; the complete interview is linked below.
area2invest: What is the Vogemann Green Ship Token?
Patrick Schütze: The Vogemann Green Ship Token is the first digital security in the field of sustainable bulk shipping, issued by the Hamburg shipping company Vogemann. To be more precise: the token embodies qualified subordinated profit participation rights. The created capital will be used to purchase bulk carriers with their own board cranes, a type of ship which is particularly flexible and can be used almost anywhere due to its size and equipment. Bulkers transport raw materials such as grain, fertilisers, coal, ores, minerals as well as steel and forest products – goods that form the basis for the things we need every day. Bulkers handle almost half of the world’s sea transport.
The total emission volume of the Green Deal is 50 million US dollars (USD). Institutional and private investors can participate from USD 1,000. The securities prospectus of the Green Ship Token was approved for publication by the FMA Financial Supervisory Authority Liechtenstein on 3 July 2020.
The interest rate is 8% p.a. and there is also a 50/50 profit sharing between investors and issuer, as far as the economic success of the issuer allows. What does this mean in plain language? If more profit is generated, the plus is shared. Even if 12% is generated, this means 2% more interest for both investors and Vogemann. From a business perspective, it is quite clear that the management will do its utmost to achieve this. Because only then will it become really interesting!
area2invest: Tell us more about the Vogemann shipping company and the idea behind the Security Token Offering
Patrick Schütze: I have known the Vogemann shipping company for many years. It was founded in 1886, a company with a long tradition. During these years a great mutual trust has developed. If anyone knows how bulk shipping works, it is the Vogemann team. Vogemann combines the shipping company, its own brokerage and various service companies under one roof. In other words: not only our own fleet is chartered out, but also a large number of other ships. The resulting market knowledge and the tightly wired network are unique. It is not for nothing that Vogemann is the only German participant to supply its panel broker data for the Baltic Dry Index (BDI) at the Baltic Exchange in London.
When neoFIN Hamburg’s plans for the first STO became concrete, I was able to talk to the managing partners of the Vogemann shipping company, Mr Arndt and Mr Lange. And although I had numerous other discussions with other possible issuers, including even other shipping companies, it was soon clear to me: they should be the ones. This consistent sustainable approach, which is not only being sought but is already being used, convinced me. My love of the sea probably also plays a role in this. I myself once went to sea. The passion for ships has never left me again.
area2invest: Why is the Green Ship Token a Green Deal?
Patrick Schütze: There are different aspects to it. The main one is certainly CO2 emissions. They are the subject of much public debate and will be penalised from 2021 onwards under the national CO2 emissions trading scheme. Shipping is also an industry that is often criticised for its emissions. In fact they are significantly lower than those of other means of transport such as aeroplanes, trucks or freight transport. Vogemann is already well ahead in this respect:
Worldwide there are currently exactly two Handysize bulkers that already meet the CO2 emission requirements of the International Maritime Organisation (IMO), which are not binding until 2029. We are talking about a CO2 reduction of over 30%. Both are new buildings from Vogemann.
But green shipping has even more sides to it. It is also about avoiding other greenhouse gases, sulphur emissions, careful use of ballast water and, in general, fuel and energy efficiency. Here too Vogemann is already setting standards today. The ships put into service by Vogemann in recent years consume between 30 and 50% less fuel than “non-eco” ships. With the Green Ship Token investors can therefore directly support the expansion of the modern fleet. Plus: They contribute to stopping climate change. And the deal is clear – 8% interest p.a. and the 50% profit-sharing, see above, is a good deal.
area2invest: How do you assess the trend of impact investing?