The Islamic Republic of Iran Shipping Line (IRISL) is looking to list on the London Stock Exchange as the company has already held talks on a possible initial public offering (IPO), Reuters said citing undisclosed Iranian and Western sources.
However, the company is experiencing difficulties in its intentions as the majority of businesses are still distancing themselves from Iran amid heating up of tensions between the US and Iran with Donald Trump assuming office as the new US President earlier this year.
Leigh Hansson and David Myers, lawyers from Reed Smith, a limited liability partnership registered in England, in an interview with World Maritime News said that “the mere existence of widespread U.S. secondary sanctions has a chilling effect on business activity.”
“In our experience, all the major participants in the maritime sector are very aware of the implications of breaching US secondary sanctions and stretch every sinew to avoid doing so, even at the expense of turning away business, in respect of which the risk is modest, for one reason or another, although the detailed approach to risk assessment and acceptance varies,” the lawyers added.
The company’s entry into the London Stock Exchange would make IRISL the first Iranian firm to list on Britain’s main exchange since the Islamic revolution in 1979, according to Reuters.
Following the easing of sanctions by US and five other world powers against Iran in January 2016, the Iranian shipping giant set an aim to modernize its fleet and revive maritime trade relations after years of isolation.
In December 2016, IRISL entered into shipbuilding contracts with South Korean shipbuilder Hyundai Heavy Industries (HHI) worth up to USD 650 million, VesselsValue data earlier indicated.
Namely, HHI was hired to build a total of ten vessels, including four 14,500 TEU Ultra Large Container Vessels (ULCV) and six 49,000 dwt MR2 tankers.
The contracts were said to be the first shipbuilding orders following the implementation of the Joint Comprehensive Plan of Action (JCPOA), known as Iran nuclear deal, between Islamic Republic of Iran and P (5+1), the UN Security Council’s five permanent members including China, France, Russia, the United Kingdom, and the United States, plus Germany, in early 2016.
After the sanctions were lifted, Iranian shipping companies have been seeking to renew their fleets and restore former shipping links, while Europe showed its intentions to revive maritime trade relations with Tehran, sending its shipping majors and port officials to ink new and restart old cooperation deals.