Aker Yards ASA has three business areas; Cruise & Ferries, Offshore & Specialized Vessels and Merchant Vessels. The business area Merchant Vessels has shipyards in Florø, Norway, Nikolaev in Ukraine, and in Wismar and Warnemünde in Germany.
FLC West will buy 70 percent ownership in the Norwegian based company Aker Yards Ukraine Holding AS, which in turn will own 100 percent of the yards in Nikolaev, Wismar and Warnemünde. Aker Yards will remain as owner of 30 percent of Aker Yards Ukraine Holding AS.
Currently, Aker Yards Ukraine Holding AS owns 100 percent of Aker Yards’ Nikolaev facility in Ukraine. Before the transaction with FLC West, Aker Yards will transfer its 100 percent ownership of the company’s yards in Wismar and Warnemünde in Germany to Aker Yards Ukraine Holding AS.
FLC is a Russian state controlled investment company with USD 1.5 billion in leasing portfolio. The company has been established to invest in industries of strategic importance. In the interest of the Russian Federation, FLC has recently also become heavily involved in developing of the Russian shipbuilding and shipping industry. FLC West is located in Luxembourg, and is owned 50 percent by FLC. The remaining 50 percent is owned by the private Cyprus investment company Almiar Investment Ltd, which in turn is owned by FLC private shareholders.
Increased international trade between Russia and international markets, combined with extensive offshore oil and gas development plans in arctic regions with harsh environment, results in a growing need for more specialised vessels. The three shipyards in Aker Yards Ukraine Holding AS will through the new ownership model be in a strong position to compete for contracts for building merchant vessels for Russian operators.
Aker Yards has already decades of successful experience with developing and delivering solutions and ships for use in Russia, and the company regards the new agreement as an interesting opportunity to further develop this business relation. The new ownership and business model supports the existing strategy of increased focus on specialised tonnage, in particular for arctic regions.
Aker Yards Ukraine Holding AS will continue to be based in Norway with headquarters in Oslo, and the company will later be renamed. Tom Einertsen, currently President of Aker Yards’ business area Merchant Vessels will become CEO of the company. There are no planned changes in management, organisation, number of employees, pensions or benefits at the involved yards as a result of the sale. Also, there are no changes to the execution of ongoing contracts and order backlog as a result of the new ownership model.
Aker Yards Florø, which is also part of the business area Merchant Vessels, is not influenced by the sale, and remains 100 percent owned by Aker Yards. The yard has currently an order backlog for more than two years with six chemical tankers of which the first ship has just been completed.
FLC West buys 70 percent ownership of Aker Yards Ukraine Holding AS and the involved yards for EUR 291.9 million. This implies a total value for 100 percent ownership at EUR 417 million, based on zero debt and zero working capital. The transaction is expected to be completed within the summer of 2008.
In Aker Yards’ accounts for 2008, the transaction will have effect from 1 January 2008. As a result of the divestment of Aker Yards Ukraine Holding AS and the involved yards, Aker Yards ASA’s annual revenues for 2008 will be reduced with approximately NOK 6 billion. Aker Yards’ net gain from the transaction compared to book value is approximately NOK 1.2 billion. Possible further effects, including possible influence on Aker Yards ASA’s EBITDA margins for 2008 and earnings per share, will be communicated when the group presents its financial results for the first quarter at 7 May, 2008.
The transaction is expected to be completed within the summer of 2008.
The agreement is pending on approval from relevant authorities, including competition authorities in Germany and Ukraine.
In line with the procedures set by the Oslo Stock Exchange, Aker Yards aims at publishing further details of the transaction shortly.