Dubai: Integrated logistics supplier Tristar has signed a multi-million dollar deal to expand into the shipping industry, after a brief downgrade of operations following the global financial crisis.

Tristar Group Chief Executive told Gulf News the company had been watching the market and thought now was the right time for it to make its return.

The Dubai-based logistics company, and Agility subsidiary, will take delivery of six new tankers from Korean shipbuilder Hyundai Mip Dockyard in 2016 at a cost of $200 million (Dh734 million).

Tristar have confirmed the deal with a 20 per cent down payment and will now speak with finance institutions for the remaining amount.

Mayne said Tristar had already secured a 25 year chartered deal with “one of the major oil companies” for all six tankers but would not divulge who because of a non disclosure clause with the oil company. Tristar’s re-entrance into the shipping market will bring in an extra 20 per cent of growth to the company, Mayne said.

Expansion plans

Tristar’s expansion into the shipping industry comes at a challenging time for the global market that is still recovery from the 2008/09 financial crisis. Even with higher fuel prices and excess capacity continue to hit the industry Mayne said that Tristar was already targeting further expansion plans.

He said the Tristar would look to take delivery of two to four more vessels but would likely partner with a different oil company as a means of diversifying revenue.

Initially a shipping manager will be assigned to operate and maintain the vessels, however Mayne said that once Tristar’s shipping fleet reach a total of 20, the company would look to take over the vessels.

Overall Mayne said it had been a good year for Tristar, which is on track to repeat a 25 per cent growth for 2012 – 2013. But even as it confirms expansion plans in the tail-end of 2013, Mayne said the company had missed some targets including two “important” contracts in Saudi Arabia.

He also said the company’s confirmed plans to expand its road tanker fleet into Saudi Arabia had taken longer than expected. He said Tristar had looked to enter the market during the first quarter but will now begin its Saudi road tanker operations in January 2014 with a fleet of 50 tankers. The fleet will target expanding to 500 tankers over the next 5 years, he said.