SAFETY MANAGEMENT OVERSEAS
Vassos P. Hajioannou was born in 1933 in Pedoulas, a village on Mount Troodos in Cyprus and was one of the twelve children of Pelopidas and Maritsa Hajioannou. The family’s financial means were extremely limited, therefore Vassos in 1953, at the early age of 20, immigrated to Jeddah, Saudi Arabia, in order to assist his older brother Lucas, who had already settled there, working as a shipping agent and dealer.
After many efforts and despite adversities, the business of the Hajioannou brothers grew considerably, gaining the respect of the local maritime community. Due to the nature of their work and the constant contact with the masters of vessels under their agency – mostly of Greek interests – the Hajioannou brothers accumulated knowledge and experience about the operation of shipping enterprises. This proved highly valuable when they decided to become shipowners some years later.
Vassos Hajioannou remained in Saudi Arabia until 1962, when one of the younger Hajioannou brothers took over the family business. Lucas Hajioannou had moved to London in 1959, after getting married a year earlier. Upon moving to London, Lucas acquired the first family vessel, a 1942-built cargo steamship that was named NEDI after his wife, while its management was undertaken by the Tharros office of the Aristides Xylas family. Vassos Hajioannou, who was by then mainly dealing with the chartering of ships, acquired a minority stake on the NEDI, as well as in all other vessels that were subsequently bought by his brother. In 1961, Lucas established in London Troodos Shipping. The partnership between the two brothers continued until 1969, when Lucas and Vassos decided to part on amicable terms, as their families had grown considerably – Vassos had also got married in 1963 his compatriot Stalo, who had given birth to three of the couple’s five children.
Alassia Steamship Co. Ltd., the company established by Vassos Hajioannou, began operations in May 1969 from its office in the City of London. Initially it managed two cargo sister ships acquired in 1968, the 1936-built PELOPIDAS 2 and the 1937-built MARITSA 2. Later that year, the 1939-built ELENI and KANARIS joined the fleet. All vessels were placed under the Cyprus flag and were registered in Famagusta. During that period, the Cyprus registry was growing rapidly thanks to the support of several Greek shipowners, having a significant impact in the country’s economy.
Hajioannou continued expanding the Alassia fleet, acquiring in 1970 two more dry cargo ships, which were also placed under the flag of Cyprus, the STALO and the STELIOS, built in 1953 and 1955 respectively. A milestone in the company’s development was the acquisition in 1972 of four dry cargo ships from the British company King Line, two built in 1952, one in 1953 and one in 1957. These vessels joined the fleet as the ELLI 2, the KANARIS, the TOULLA and the ELENI 2, respectively, all under the Cyprus flag. The timing proved ideal, as it coincided with a surge in freight rates. As a result, Alassia’s balance sheet improved dramatically within a short period of time.
A year earlier, Vassos Hajioannou had relocated to Greece, establishing offices in Piraeus, which was rapidly becoming an important maritime hub. As part of his relocation he commissioned the construction of an office building to house Alassia’s operations, as well as other companies.
The Turkish invasion of Cyprus in 1974 shook Hajioannou, who decided to offer land plots that he owned in Nicosia, for the setting up of refugee camps. He also donated a significant amount – disproportionately large for his financial status – to support his fellow countrymen. At the same time, all Alassia vessels were maintained under the Cyprus flag, at a time when the growth momentum of the Cyprus registry was reversed, due to the developments in the country.
Unlike his brother Lucas, who was mainly active in the tanker sector, Vassos was relatively restrained as far as his shipping investments were concerned, acquiring exclusively dry cargo ships. In 1973, he bought his first bulk carrier, a 5-year-old 40,000-dwt vessel. The STALO 2, as the ship was named, was acquired for $11 million, an unusually high price for the time’s standards, which nevertheless reflected the booming freight market. The vessel was fixed for two years to a Chinese charterer, but at the time of redelivery the market had plummeted. Vassos Hajioannou faced an extremely difficult situation, having to repay a substantial loan, which was not in line with prevailing market conditions.
Nonetheless, thanks to his ingenuity, he managed to overcome this hardship. At the time, Saudi Arabia was experiencing a construction boom. Hajioannou turned to old acquaintances from his Jeddah years and managed to close a deal for the supply of about 3 million tons of cement. Combining transport and trading, he was buying cement and was supplying it to the Saudis with his own ships, thus overcoming the crisis at a profit. He often said that this deal was the result of the reputation and contacts he had built while working in Saudi Arabia and that he always made sure to maintain his reputation at any cost.
Hajioannou followed that principle when he was forced to cancel four newbuilding orders, placed in 1976 at British and Japanese shipyards. In order to avoid exchange rate risk, he had bought in advance pound sterling and Japanese yen, as the four orders were placed in local currencies. Even though he lost the deposits he had paid for the four vessels – as per the terms of the contracts – the gain from not getting delivery of overvalued assets, as well as the significant overvaluation of the yen he was holding, outweighed the loss of the deposits. Vassos Hajioannou had managed to overcome yet another obstacle, without damaging his reputation.
Taking advantage of the improved freight market in the late 1970s, Alassia completed its shift towards the bulk carrier sector, selling at a high price its general cargo fleet, while buying in 1979 two bulkers, the 1968-built PELOPIDAS and MARITSA. Two years later, Hajioannou sold the PELOPIDAS at a significant profit. His fleet now consisted of just two bulkers, something that proved a blessing during the deep crisis of the 1980s. He avoided expanding his fleet during that challenging time, with the exception of a bulk carrier acquired in 1983, which was subsequently sold in 1988 to Chinese interests at a considerable profit. In 1986, just as the market started to recover, he acquired two 9-year-old bulkers, 40,000 dwt each, at rock-bottom prices.
Prudent management during the crisis laid the foundations on which Alassia’s contemporary philosophy was built, that is the provision of a first-class service through a modern fleet of newly-built bulk carriers. The new generation of the family, Vassos’ eldest son Polys, a naval architect, and his younger brother Nikos, had by then joined the company.
A new chapter opened in 1995 with the delivery of Alassia’s first two newly-built panamax bulk carriers from Samsung Heavy Industries Co. Ltd. in South Korea. A short while before their delivery, Vassos Hajioannou announced to his son Polys that from then on, the family’s younger generation was then one to grow the company and that he would only remain as an advisor to his sons, sticking to his word even though he was only 62.
Even though he had voluntarily retired from Alassia’s day-to-day operations, Hajioannou made his mark once again by deciding the company’s new name. As at the time the ISM Code was about to be implemented, requiring the presence of a full management company in Greece, he suggested to name it “Safety Management” and simply add the word “Overseas”.
Vassos Hajioannou passed away in 2002 leaving behind some important entrepreneurial and public benefit initiatives. However, according to his closed ones, his greatest success was the preparation of his son Polys to take over and expand the family business.
Polys Hajioannou took the helm of the company at the age of 36. Within 14 years its fleet reached 38 ships, most of them newly built. In 2008 it entered in the New York Stock Exchange, with the majority holding remaining with the Hajioannou family. Meanwhile, Polys’ younger brother, Nikos Hajioannou, followed in his father’s footsteps by reviving Alassia through Alassia Newships Management.