© St. Petersburg Times, published February 27, 2002
I remember sitting in my piano teacher's waiting room every week, reading and re-reading all the National Geographic magazines . . . As a land-locked Michigan kid with dreams of the ocean, I was always drawn to the articles about underwater exploration, especially shipwreck archaeology.
-- Greg Stemm, co-founder and operations director, Odyssey Marine Exploration, Tampa
Is Greg Stemm's childhood dream about to emerge from under the Mediterranean Sea?
Tampa's Odyssey Marine Exploration, a little-known but publicly traded company, may have found the remains of a large, 17th-century, 80-gun British warship that went down in a storm with a vast load of gold or silver coins. A company estimate of the cargo's value (assuming it is still there): $500-million. Maybe more. Maybe less.
Odyssey is seeking permission from British defense officials to bring up the remains of the HMS Sussex. The ship, lost in 1694, lies half a mile deep near the Strait of Gibraltar.
"It is a really exciting time, but that is overridden by an incredible level of busyness," Stemm says. "We hardly have time to be excited."
An exciting -- and sensitive -- time for Odyssey Marine. The company still is negotiating with Britain's Ministry of Defense for permission to bring up the remains of the warship. Odyssey's also keeping government officials informed in nearby Spain, as well as U.S. officials back home.
"We're balanced on such a fine point politically, legally and diplomatically," Stemm says. "A twist of one word can throw the archaeological community or British government into a tizzy."
For example, Stemm takes great pains to avoid the phrase "treasure hunters." To the public, the phrase may sound harmless. But to those in the underwater archaeology field, it's insulting -- even "fighting words," Stemm says.
The British government has the option to purchase the entire contents of the Sussex. More likely, Odyssey would receive a major portion of the valuables, but bear much of the costs of recovery, cleaning and preservation, marketing and public viewing.
"Our business plan anticipates that traveling exhibits and fixed museums will also play an important role in the company's earnings," Stemm said.
One possibility among many at this early stage: Showing the Sussex findings at the Florida International Museum in St. Petersburg, which could use a blockbuster these days.
Stemm, 44, began working not as an undersea explorer but in advertising and public relations. One of his first jobs was working PR for entertainment legend Bob Hope. By the late 1980s, Stemm and two other partners had formed their own full-service advertising agency in Tampa with such diverse clients as NCNB bank, Cruise Jamaica and the Hogan Group real estate company.
Stemm fell into the deep-sea diving scene through the back door. In 1987, he made an offhand, $50,000 offer (outbidding 14 others) for an 83-foot, 190-ton deep-sea diving research vessel named the R.V. Seahawk. The one-time shrimp boat had been seized by the Coast Guard in a drug bust, which helped explain the vessel's nickname: the Shady Lady.
That same year, Stemm teamed up with an ad client, John C. Morris, to start a company called R.V. Seahawk and hunt for sunken ships. The company later went public under the name Seahawk Deep Ocean Technology.
In the early 1990s, the Securities and Exchange Commission began investigating the company for securities violations. But after seven years and half a million dollars in legal fees, the company (including Stemm, Morris and another partner) were cleared of all charges by a federal jury.
Not surprisingly, the lengthy battle to clear their names still pains Stemm. Neighbors avoided his family during those years. Stemm and Morris left Seahawk in 1994, and later formed and took public Odyssey Marine to continue their undersea ambitions.
Like many businesses dependent on "discoveries" -- be they pharmaceutical companies trying to find the next wonder drug, or an undersea exploration company looking for a new shipwreck with valuable cargo -- Odyssey is a classic story of financial hits and misses.
In the fall of 2000, the company even recruited tourists ($2,250 per person per day to defray exploration costs) aboard when it began hunting for a large, colonial 17th-century man-of-war code-named "Cambridge." Odyssey's real target: the HMS Sussex.
In early 2001, St. Petersburg millionaire Jim MacDougald acquired a 36 percent stake in Odyssey. MacDougald was the co-founder of employee benefits processor ABR Information Services, a company he sold in 1999 to Ceridian Corp. of Minneapolis for $750-million. MacDougald briefly became chairman of Odyssey while the company focused more resources on the hunt for the Sussex.
By last summer, Odyssey was almost certain it had found the warship off Spain's southeast coast in the western Mediterranean. At the time, major British newspapers touted the possible find, bumping Odyssey shares briefly from under $1 a share to as much as $1.64 on Aug. 16.
The St. Petersburg Times briefly noted the possible Sussex find in October. But U.S. newspapers largely ignored the news of a possible undersea jackpot. Odyssey shares trickled lower through last fall into early 2002, hitting a low of 52 cents in early February.
Last Sunday, the New York Times ran a front-page story essentially reinforcing last summer's news: that Odyssey and the British government were now nearly certain the Sussex wreck had been found. After a closing share price of 90 cents on Friday, Odyssey's stock opened at $1.68 on Monday, climbing briefly to $1.93 before closing at an all-time high of $1.50. Shares closed Tuesday at $1.29, down 14 percent.
"The shipwreck business is not a short-term play," Stemm says. "It is a complicated, capital-intensive, long-term endeavor. We are careful to warn people of the risks inherent in our business."
Finding the Sussex was no easy task. A researcher brought documents about the Sussex and its potentially valuable cargo to the attention of company executives. More research delivered an approximate idea of where it sank in a 1694 storm.
The Sussex was the flagship of a British Royal Navy fleet, commanded by Rear Admiral Sir Francis Wheeler. The ship was less than a year old when it set sail from England on what researchers believe was a key mission: to deliver a large cargo of coins destined to pay the Duke of Savoy for his continued assistance in a war against France's Louis XIV, the Sun King.
When the Sussex sank, Savoy defected to the French. The standoff set the scene in North America for the French-English wars, which in turn helped prompt the American Revolution.
So where do things stand?
While awaiting a final contract with the British government to begin excavation, Odyssey's archaeology team remains in Tampa preparing for a recovery effort in the Mediterranean.
If the vessel's historical significance pans out as Odyssey hopes, if Odyssey's salvage effort at the wreck site finds the valuable cargo of gold or silver coins, if the British government is satisfied with the findings, and if Odyssey can find a receptive market for the Sussex treasures, then a still-young Tampa company may just have hit a home run for its patient shareholders.
And made a pretty grand contribution to our understanding of what happened 308 years ago.
-- Robert Trigaux can be reached at trigaux@sptimes.com or (727) 893-8405.