Local Effort Being Made to Buy N.Y. Ferry Service Catamarans

Ed. note: some contents of the original Asbury Park Press article have been, uh, updated. The original article can be purchased here.

By MICHAEL L. DIAMOND
BUSINESS WRITER
Asbury Park Press
December 18, 2007

A Wall Street executive said Monday he is working with local investors to buy four high-speed catamarans used by SeaStreak America Inc. to ferry passengers from Monmouth County to New York.

The possible bid from a group led by Michael Gooch, a Rumson resident and chief executive officer of the brokerage service GFI Group Inc., could ease fears that the boats will be sold to Trinidad and Tobago as part of a bankruptcy reorganization.

"Myself and other investors are not really, frankly, interested in being ferry operators," Gooch said. "We're just interested in seeing a quality ferry service continue."

The move comes as the future of the ferry service remains in doubt. SeaStreak's parent company, Sea Containers Ltd. of Bermuda, filed for Chapter 11 bankruptcy more than a year ago after it became burdened by debt. Among the creditors are unnamed banks which own the high-speed boats and charter them to SeaStreak.

Reports surfaced last summer that Trinidad & Tobago was prepared to offer $30 million for the boats to begin ferry service in the Caribbean nation.

Some 2,000 people a day take the boats — 400-passenger vessels that travel more than 40 mph — from Highlands and Atlantic Highlands to Manhattan, and the possibility of losing the service has unnerved them. Commuters say the ferry ride gets them to New York in about half the time it would take if they drove or took the train. Many of them said it is a major reason they live in Monmouth County . They worry that replacement boats would be much slower.

Losing the boats "would be an absolute disaster," said Robert Picard, who takes the ferry each day to get from his Rumson home to his office in midtown Manhattan. "There are no boats around that could replace those four."

In addition to working with investors, Gooch said he has talked to a ferry operator about taking over the service and investing in it. He declined to name the operator. But he said he is close to making what he called a "preliminary, nonbinding bid."

Gooch said there is little to prevent the vessels from being sold to Trinidad and Tobago — or to any other buyer. So local legislators have asked government agencies to intervene if the vessels are sold to a foreign country — if only to give Gooch and his investment group more time.

U.S. Rep. Frank Pallone, D-N.J. asked the U.S. Maritime Administration to block the vessels' sale to a foreign country. But Shannon Russell, a spokeswoman for the agency, said, the agency only regulates the sale of U.S. vessels that weigh more than 1,000 gross tons, which is bigger than the SeaStreak boats."

There's nothing that the Maritime Administration can do to stop this sale if, in fact, it happens," Russell said. "It's not against the law. It's nothing that we regulate."

In New Jersey, state Sen. Joseph M. Kyrillos Jr., Assemblywoman Jennifer Beck and Assemblyman Sean Kean, all R-Monmouth, last week wrote Attorney General Anne Milgram and asked her to investigate legal grounds to block the vessels' sale to a foreign country.

Lee Moore, a spokesman for the Attorney General's Office, said attorneys are reviewing the letter.

Gooch said other hurdles remain. Namely, the local investment group won't pay more than what the boats are worth, making it unlikely that it would get involved in a bidding war that would make it a money-losing venture.

The group approached a sample of the ridership to survey their thoughts on potential new services to increase revenues. Services mentioned in the survey include additional food and beverage offerings such as pork roll, egg and cheese sandwiches for the morning commutes and selections of gourmet hot dogs, beers on tap from local brewers and single malt scotch tasting events on the afternoon and evening routes.

Vessel naming rights are currently being negotiated should the group move forward with the purchase. Fantasies, a gentlemen's club in Keyport, is considering sponsorship of the current SeaStreak New Jersey. Gooch said other local business being approached include McLoone's Restaurant Group and Ray Cantena Motors.

Willie Graber, a spokesperson for Fantasies' management would not disclose how much his clients have bid for the vessel's naming rights but joked that the sponsorship would be paid for with singles. "We're still negotiating so there's really nothing to comment on at this time. SeaStreak's clientele ride in the lap of luxury, we want to put our brand in their laps," Graber said.

Gooch summed up the group's mentality at this point, "individuals are willing to put up money to save the service, but not lose money. They want to know if they did invest, it would be professionally run and the economics make sense. We're trying to put that together."