When other shippers cut back, Lower Lakes is able to increase its fleet by purchasing and retrofitting older ships
Written by Adam Zarboni & Produced by Sabah Choudhry
Watching the ships travel down the St. Lawrence Seaway is something many people make a day of. The immense ships going through the locks, and the deep rumble of the low base shipping horns makes for a pictur¬esque scene. Most people may not know much about the steel ships that sail down the waterway every day or the people that work on them. It is not background images, they are an integral part of the Canadian and American trade process.
Lower Lakes Towing Ltd. has made it its business to maintain this important trade route, staffing it with highly qualified captains and crews. When most shipping companies were reducing their fleets, Lower Lakes was able to increase their fleet size by retrofitting older, tried and true haulers. Of these they have recommissioned seven ships, the Cuyahoga (which first was commissioned in 1943), the Kaministiqua, Michipicoten, Mississagi, Ojibway, Robert S. Pierson, Saginaw, which are all registered to the port of Nanticoke.
The St. Larry Seaway is a system of canals that permits ocean-going vessels to travel from the Atlantic Ocean to the Great Lakes, as far as Lake Superior. The system extends from Montreal to Lake Erie, and is one of the major in-roads for trade arriving from, and exported to ports in the Atlantic Ocean.
Rather than a completely natural water¬way, it relies on a series of locks to access the major waterways included in the system, consisting of 13 Canadian and 2 U.S. locks. It is considered one of the outstanding engineer¬ing feats of the twentieth century. It is here that Lower Lakes Towing gets down to work.
Since the 1980s, with declining activity from the steel industry, most of the fleets operating in the waterway have declined by more than half. While other companies are downsizing their fleets, Lower Lakes is picking up the slack by continuously expanding its services.
Captain Scott Bravener, who, along with several partners founded the company in 1994, has been servicing the Great Lakes region since then, and is based in Port Dover, Canada. Bravener has been Chief Executive Officer and President of Lower Lakes Towing Ltd. since its founding. Until as recently as 2001, Bravener served as the Captain of the Cuyahoga, owned in whole by Lower Lakes. He has been active in the shipping industry in the Great Lakes since 1982, working for several com¬panies before founding Lower Lakes in 1994. Bravener graduated from Georgian College, in Owen Sound, Ont. and is certified in Marine Navigation Technology.
In 2006, Lower Lakes was acquired by Rand Logistics, which placed them in the unique posi¬tion of expansion yet again. By joining the Rand roster they have become one of the single largest transport companies operating in the Great Lakes. The ships, which many classify as mid-sized, can easily access ports of call that many of the larger self-unloading transports cannot.
At the time of the acquisition, Laurence S. Levy, Chairman and CEO of Rand said that he “could not be more enthusiastic about this transaction. After a comprehensive due dili¬gence effort, we found the companies to be an extremely attractive investment opportunity. The companies have developed a 30 percent share of the niche Great Lakes River Class bulk freight market, and benefit from substan¬tial regulatory and asset-oriented barriers to entry. They have built an attractive, diversified base of customers, which are generally serv¬iced under long-term contracts. Additionally, the company’s expert management, which has long-standing industry relationships, together with the well maintained fleet provide consid¬erable competitive advantages.”
“From a financial perspective, the business has historically been characterized by consistent revenue and EBITDA growth, and stable, predict¬able cash flow. Looking forward, the companies are positioned to benefit from continued economic improvement and end market growth. Additionally, I believe this transaction and Rand’s conserva¬tively leveraged balance sheet will produce a strong vehicle with which to pursue acquisition opportunities for other companies operating under the Jones Act.” The Jones act stipulates that Canadian crews must be involved if the ships are to operate at Canadian ports of call.
Bravener, who was optimistic during the acqui¬sition, says that he believes “strongly in our future prospects and am confident that the companies will benefit from Laurence’s leadership and exten¬sive experience operating and growing logistics businesses. We look forward to consummating this transaction and combining our strengths.”
Some of the story of the success of Lower Lakes Towing is its ships. Many of them are steeped in colorful histories of their own. Bravener’s own ship, Cuyahoga, was pretty much rescued from a ship graveyard and brought back to life under the Lower Lakes flag. It’s about rescue and revitalization, and Lower Lakes has thrived as it enters into a new chapter in its proud history.
View Digital Corporate Profile of LowerLakes in Construction Digital June 2009