Chapter I Information about the Company and Its Subsidiaries
Brief Historical Overview of Bahri
The National Shipping Company of Saudi Arabia (Bahri) was established as a Saudi joint stock company by virtue of Royal Decree No. M/5 on January 22, 1978. The Company’s headquarters is located in Riyadh, Saudi Arabia. Bahri is a leading company in global maritime transport. The Public Investment Fund (PIF) today holds 28.2% of the Company’s shares, whilst the remaining shares are owned by individuals and institutional investors. Bahri entered the world of maritime transport with chartered general cargo vessels. Soon after, between 1981 and 1983 the Company acquired six multi-purpose ships. The ships were used to transport general cargo, and represented the first fleet owned by the Company, which later expanded its activity by establishing NSCSA (America) Inc. in 1991. The America office serves as a general agent of Bahri and is responsible for transporting containerized, break-bulk and RoRo shipments from and to North America through the Company’s general cargo vessels. It is also responsible for managing several other tasks related to shipping services in North America. In 1985, the Company began transporting petrochemicals after acquiring two chemical tankers. The Company also established a joint venture with United Arab Shipping Company (UASC) under the name Arabian Chemical Carriers (ACC). ACC in turn acquired one of the two tankers and chartered it out to SABIC. The second tanker was also chartered to SABIC. In 1990, the Company expanded its chemical transport activity by establishing National Chemical Carriers (NCC), a joint venture with SABIC, which was dedicated to acquiring, chartering and operating chemical tankers. In 1992, the Company decided to further diversify its activities by entering the crude oil transport sector and built five VLCCs, which went into operation during 1996 and 1997. In 2001, the Company acquired four new VLCCs, expanding the fleet to nine carriers. Since then, the VLCC fleet has steadily increased and today the Company owns 17 VLCCs.
Due to the expansion of its fleet and its activities, in 1996 Bahri established Mideast Ship Management Ltd., a joint venture with Acomarit, a ship management company based in Scotland. This company provides ship management services for the vessels and tankers owned by Bahri and its subsidiaries. In 2005, Bahri took over Acomarit’s shares in the joint venture and became its sole owner. Mideast Ship Management Ltd. began providing ship management services for nine vessels and gradually expanded its operations in line with the expansion strategy of Bahri. It now manages 41 ships including chemical tankers, VLCCs, and RoRos. The fleet size is expected to increase to approximately 76 vessels by the end of 2014 which includes the Vela fleet. In 2005, the Company invested in the business of Liquefied Petroleum Gas (LPG) transportation by acquiring 30.3% of the shares of Petredec Ltd. In line with the Company’s strategy to diversify its business and increase its investments, in 2010 it announced its involvement in the new activity of the transportation of dry bulk cargo by establishing a joint venture under the name Bahri Dry Bulk Co. LLC (BDB), which is 60% owned by Bahri and 40% by ARASCO. BDB began operations in 2012; it specializes in dry bulk transportation. In 2012, Bahri was named the Best Managed Company in the Middle East in the transport and shipping sector by Euromoney. The Company is committed to full transparency in all aspects of its operations, especially with respect to the disclosure of the results of its operations. The Company adopts safety standards in all its operations, not to mention environmental protection standards. The Company is also committed to shouldering its social responsibilities, achieving constant growth, and fulfilling its mission and objectives through the implementation of successive strategic plans and the optimum exploitation of available resources.
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