What’s in a name? For Bhagwan Marine, plenty of good fortune

The Bhagwan name has been lucky for the Kannikoski family. In Sanskrit, Bhagwan translates to blessed or prosperous, and husband and wife team Loui and Kerren Kannikoski reckon their Bhagwan Marine has garnered plenty of good fortune since it was set up in 2000 off the back of the family’s Geraldton crayfishing business. With more than 1000 staff and nearly 100 vessels, the national marine services group is now taking the next step — a jump onto the ASX trading boards after a public share sale that will value the family’s holding at more than $70 million. The Bhagwan name remains a talking point more than 20 years after the company’s inception, a throwback to the 1980s when hundreds of orange-clad devotees of Bhagwan Shree Rajneesh, an Indian self-help guru who talked about sex as a path of superconsciousness, made Fremantle a hub for the Rajneeshee. Speaking from Bhagwan Marine’s St Georges Terrace offices, managing director Loui and corporate services general manager Kerren recalled that the name originated with a friend, Alan Kelly, who was dubbed “the Guru” for his fishing expertise. Kelly later doubled down on the joke by building his own boat and naming it the Bhagwan. Bought by the Kannikoskis, the vessel spearheaded the family’s expansion into oil and gas marine services in 1997. “It was all a bit of humour at the time ... but if we would have called it Loui and Kerren Marine, we wouldn’t have had the story to tell,” Loui laughs. “The name’s been good for us,” Kerren agrees. Also harking back to the company’s formative days in Geraldton is its logo, which depicts a bare-chested male flexing his muscles above a bow wave. It is modelled on a toy action figure of early Australian professional wrestler Mario Milano that was retrieved from a skip bin and attached to the bow rail of the first boat built by the Kannikoskis. Bhagwan Marine is raising $80m from the issue of 127 million shares at 63¢ through Euroz Hartleys in the biggest WA float since APM’s record-breaking effort in late-2021. The Kannikoskis — Kerren, Loui and his 93-year-old mother, Matilda — will emerge with a 40.5 per cent stake valued at $70.3m. The listing and the tight restrictions that come with life on the ASX will be a major change for a company which prides itself on a strong family-driven entrepreneurial culture. The Kannikoskis’ son Tom also works in the business, along with Loui’s sister and a niece. “We’ve had plenty of days and nights when we asked ourselves, ‘are we doing the right thing’,” Loui says. “But the company has probably outgrown us. We need to strengthen the balance sheet and be able to take on future opportunities.” Bhagwan Marine had its origins with Loui’s Finnish-born father Lauri, who first visited Geraldton after WWII as a merchant sailor aboard a bulk carrier hauling WA lead to Sydney. Finding his way back to the town in the early 1950s, Lauri became a crayfisherman. Loui joined him out of school as a 14-year-old in 1974, taking over the multi-vessel business when his father stepped aside in the mid-1980s. As a string of oil and gas discoveries off the State’s north-west in the 1990s confirmed WA as Australia’s premier energy province, the Kannikoskis saw an opportunity to help service the development spree. “We might have been a bit naive thinking we were going to change the world,” Loui says. “But the timing was probably perfect.” Running the fledgling business from their lounge room, the couple started out contracting a single crayfishing boat as an offshore support vessel to Total Marine in 1998. Two years later, they gambled by building their first boat without the support of a contract, winning their first work from Apache Energy. “We had an absolute ball,” Loui says. “The first probably 12 years of the business was amazing.” By the time private equity group Catalyst came aboard in 2011, buying a 33 per cent stake, the fleet had ballooned to more than 70 barges, tugs, landing craft, and crew transfer and utility vessels, as Bhagwan won contracts to service another rush of work triggered on new LNG projects including Chevron’s Gorgon and Wheatstone. The Kannikoskis bought back the Catalyst stake in 2020. “Our aim was to build a business that we were proud of, but never in our wildest dreams did we set ourselves getting over 100 boats and 1000 people,” Loui says. However, it hasn’t been without challenges. First there was a protracted downturn in oil prices in 2014 that reduced work across the energy sector. Then there was the Kannikoskis’ decision in 2018 to move Bhagwan’s headquarters from Geraldton, where it was a major private employer, to Perth to be closer to the company’s clients. Kerren, who had lived in Geraldton since she was 21, concedes the relocation was “the hardest thing we’d ever had to do”. “We loved Geraldton and the people we worked with were all friends and friends, and it was really tough having to pack up and sell the family home.” Only a handful of the Geraldton staff followed the Kannikoskis to Perth. “We didn’t really understand how much IP we would lose, because those people had helped us build it (Bhagwan Marine),” Loui says. Having diversified into new areas about 10 years ago, the group is now much more than just oil and gas. It also provides near-shore and subsea services to the civil construction, marine logistics and defence industries. And while oil and gas remains a key area, the decommissioning of depleted projects, the roll-out of renewables, including offshore wind farms, and maintenance and repair services offer the biggest growth. “When we built the business, we saw an opportunity and went with it,” Loui says. “We never understood how far it could get.” “In my recollection, I’ve never seen such an horizon. “We will see ups and downs, but the future is amazing.”

What’s in a name? For Bhagwan Marine, plenty of good fortune

The No. 1 source of news for every West Australian

Subscribe

Subscribe