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New York equity firm acquires Rand Logistics

2017-11-22

McKeil Marine's Evans Spirit  won the International Bulk Journal's 2016 Ship of the Year Award during the IBJ's Salute to Excellence in the Maritime Bulk Industry gala awards ceremony in London, UK on November 21.
"It's a fantastic way to closeout our 60th anniversary year: having a vessel named after our founder, Evans McKeil, win this prestigious international award," said Steve Fletcher, President and CEO of McKeil Marine.
Acquired by McKeil in 2015, the Evans Spirit is a cargo ship with the shallow draught characters of a tug and barge; however, compared to a tug-and-barge unit, she can transport approximately 40 per cent more cargo about 50 per cent faster on a very similar amount of fuel.  She is in service throughout the Great Lakes and St. Lawrence River.
Evans Spirit was shortlisted for 2016 Ship of the Year competing with three other vessels: CS Bright, Mitsui OSK Lines, Japan;  Damen Shipyards, Netherlands; and MN Baroque, Swiss Marine, Switzerland. The award is presented to the owner, operator or builder of an outstanding individual bulk ship. Judged on operational efficiency, design innovation, safety and environmental protection, the Evans Spirit was selected as winner. (Photo Paul Beesley).

Rand Logistics, Inc., a leading provider of bulk freight shipping services throughout the Great Lakes Region, announced that American Industrial Partners (AIP) has agreed to acquire the Company. AIP is a New York-based private equity firm with over $4.0 billion of assets under management that focuses on buying, improving and growing industrial businesses in the U.S. and Canada.

Through its subsidiaries (Lower Lakes Towing and Grand River Navigation), Jersey City-based Rand Logistics operates a fleet of three conventional bulk carriers and 12 self-unloading bulk carriers including three tug/barge units.

Under the terms of the agreement entered into between Lightship Capital LLC, an affiliate of AIP, and the Company, AIP has agreed to convert all of the Company's second lien debt into 100% of the new common equity of the reorganized Company (subject to dilution by shares to be issued under a management incentive plan). The transaction announced on Nov. 21 will materially de-lever the Company's balance sheet, eliminating approximately $90 million in outstanding debt and will also dramatically reduce annual interest expense.

As a result of the AIP transaction, which will be effectuated through a pre-packaged plan of reorganization, Rand will enjoy its strongest financial position in recent years. Rand's business will continue uninterrupted pending completion of the transaction, the terms of which provide for payment in the ordinary course of all Company vendors and other unsecured creditors.

 

"We are pleased that we have reached an agreement, which will allow Rand to significantly reduce its debt burden and partner with a leading private equity firm," commented Edward Levy, President and Chief Executive Officer of Rand. Mr. Levy added, "the transaction firmly addresses Rand's recent balance sheet challenges and positions the Company for continued customer service and growth."

"We are thrilled to partner with Rand and its leadership team to welcome a new beginning for a clear market leader in shipping and logistics on the Great Lakes," said Jason Perri, a Partner of AIP. "Rand's track record of reliability, safety and service in moving critical raw materials among world class customers between ports on the Great Lakes speaks for itself. We are pleased to help Rand reduce its debt burden and restore its financial health for the benefit of all stakeholders, especially customers and employees, and look forward to working with Rand to continue to improve its operations and broaden its capabilities as a new platform for growth under our ownership." (Photo Paul Beesley)

 
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