Maritime Survey Australia completed a Pre Purchase Survey this week in Hurghada, Egypt. The vessel is a 35m steel “live aboard” dive charter vessel. The vessel is currently undergoing a refit at the Safage shipyard on the Red Sea. Built in 2004 at the Port Said Boatyard.
The importance of Pre Purchase Survey or due diligence cannot be overstated; a little bit of time and money spent prior to purchasing a boat should save a lot of time, frustration, and money if she turns out to be other than advertised. Occasionally it uncovers issues that even the owner was unaware of.
Buying a ‘pre-loved’ vessel irrespective of the size without undertaking due diligence can oftentimes be brought with danger. Sometimes things work out and we are delighted, but more often than not we see the inevitable train-wreck (or shipwreck!) to unfold.
The primary aim of a pre purchase survey and doing due diligence as distinct from ‘tyre kicking’ is to assess whether what you see at the berth is what you will get at the end of the day. The surveyors report will provide the client with enough information to make an informed decision.
Depending on the type of vessel being purchased, the pre purchase survey may comprise a desk-based and/or physical survey (in/out water).
The desk-based exercise may consider her technical and statutory/convention documents ie logbooks, Certification, Stability Book, Maintenance records and hopefully minimise any surprises such as engine logbook is missing and no idea as to her maintenance schedule or whether there are outstanding recommendations that require remediation, etc, and the list goes on.
The outcome of the survey may reveal a well-maintained vessel or uncover additional lines of enquiry which could either serve to assist in a decision to proceed with or walk away from the deal or arguably provide leverage to negotiate a reduction in sales price.
A further aspect of a pre purchase survey to consider, relates to the intended use of the vessel. Examples could be purchasing a recreational vessel with the intention of commercial chartering or converting a fishing trawler into an expedition or research vessel. If the intended use is like for like then the exercise is clear cut, but if somewhat different closer attention will need to be paid as to whether it is possible (physically or financially) to undertake the conversion (or use in the matter you intend) within your budget and/or the constraints/vessel rules in the area you intend to use the vessel. A little caution over a “she’ll be right” attitude could be the difference between a vessel aligned with your vision and one existing in your nightmares!
It is imperative to ensure that the sale and purchase agreement provides the ability to undertake a pre purchase survey in the form of both a sea-trial and condition survey.
If you are considering a vessel purchase feel free to contact us and we will be more than happy to assist.