Monday, 10 June 2019

Brodosplit Building Polar Cruise Ship for Quark Expeditions

ZAGREB, June 10, 2019 - The keel of a groundbreaking polar expedition ship to be called the Ultramarine, which is being built for US client Quark Expeditions, was laid at Brodosplit shipyard on Monday.

The ship to be completed next year will be 128 meters long, with a beam of 21.5 meters, it will weigh 13,500 gross tons and have two helidecks and 20 fast life boats. Four electric and diesel engines will enable it to sail at 16 knots.

The ship will combine state-of-the-art technology and cutting-edge safety features that will enable passengers to disembark more quickly and go deeper into the polar wilderness.

"This is a new business success for Brodosplit and a positive step forward on the market. This will be a beautiful ship that will accommodate 196 passengers who will be cared for by a 113-crew. With such ships, Brodosplit is definitely competing with the world market," said the dock's spokesman, Josip Jurišić.

He added that Brodosplit was operating in the black and its order books were full until 2022.

More news about Croatian shipyards can be found in the Business section.

Friday, 15 March 2019

Živi Zid Accuses Major Parties of Brodosplit Wrongdoing

ZAGREB, March 15 (Hina) - Following the announcement by the opposition Živi Zid party that it would file a criminal complaint against the owner of the Brodosplit shipyard, Tomislav Debeljak, the shipyard's management, Prime Minister Andrej Plenković and his predecessors Tihomir Orešković and Zoran Milanović, and former Economy Minister Ivan Vrdoljak for financial wrongdoing at the Split-based shipyard, the ruling HDZ and the strongest opposition party SDP denied their responsibility for the current problems at Brodosplit, accusing each other of financial machinations.

The chairman of the HDZ parliamentary group, Branko Bačić, said that criminal complaints were Živi Zid's "modus operandi", adding that what people thought of them was best shown by a fall in their approval ratings. He said that the government of Prime Minister Plenković cared about the shipbuilding industry, especially about the Uljanik Group, but had to deal with problems of the previous SDP government.

"When (the SDP-led government) said in 2012 and 2013 that the five billion kuna invested was the last the government was giving and that there would be milk and honey after that, they obviously were not telling the truth. Already by the end of 2015, at the end of the SDP's term, a guarantee was issued to Uljanik which was not spent on what it was issued for, so that last year we had to allocate 916 million kuna so that workers could receive their wages. That was done by this government to give the management enough time to agree a restructuring plan and find a strategic partner, but it turned out that they did not find a partner and the plan was made sloppily," Bačić said.

Branko Grčić, an SDP MP and former deputy prime minister in the Zoran Milanović government, described Živi Zid's move as "the initiative of a group of people who never even ran a local council, which means that they never took care of thousands of people who worked or who work in the shipbuilding sector."

"They don't understand the significance of the shipbuilding industry for the Croatian economy and state. Shipbuilding accounts for about 15 percent of exports and that is reason enough to fight for this industry," Grčić said.

Grčić said that contrary to their statements, the present and previous HDZ governments had issued about 360 million euro in guarantees to Uljanik and a further 45 million dollars to the Uljanik shipping company, but nothing of that "was built into the ships". "After a while they faced a crisis at Uljanik, whereas what we did produced certain results and was visible in the delivery of newly-built ships."

More news about the Croatian shipbuilding industry can be found in the Business section.

Wednesday, 27 February 2019

Brodosplit Says Its Offer for Uljanik Contains Guarantees

ZAGREB, February 27, 2019 - Brodosplit's offer of strategic partnership to the Uljanik shipbuilding group contains all the necessary guarantees, the shipyard said on Tuesday after Economy Minister Darko Horvat said the strategic partner must provide clear guarantees that it was willing to finance Uljanik's restructuring.

"The answers to all the questions, including those asked today, are in our offer which... was accepted because it contains the necessary guarantees for everything we offered," Brodosplit said.

The dock said it had expressed willingness to ensure, with appropriate collateral, in the period until the restructuring programme is approved, part of the funds necessary, to complete the ships under construction, which would relieve the state.

"Not only that. With our professional approach, we opened all the doors in Brussels to a positive restructuring and the payment of the unpaid workers' wages. We did all that voluntarily, just so that we can assist the workers, Croatian shipbuilding and the state," Brodosplit said.

"Our offer, which contains all those answers, is still valid, although its expiration date is near and, as we said in the offer, after the other stakeholders do what is necessary, we are willing to immediately launch and do all that we offered," it added.

More news about the Uljanik shipyard can be found in the Business section.

Saturday, 9 February 2019

Brodosplit CEO on the Future of Uljanik

ZAGREB, February 9, 2019 - Brodosplit management board chairman Tomislav Debeljak said on Saturday that at the moment it was important to ensure a financial injection for the Uljanik shipbuilding group and that a possible folding of the Uljanik and 3. Maj docks would mean the end of shipbuilding as a strategic industry in Croatia.

Speaking to Hina, he said the injection was necessary "to drastically cut the total expenses" and that it was also important "to reach a quick agreement between everyone involved so as to ensure all the conditions for recapitalisation."

Earlier this week the Brodosplit dock was selected as a strategic partner for the Uljanik Group.

Debeljak said he did not expect any problems with the unions active in Uljanik. "If we reach an agreement, we will have to urgently draw up and agree a restructuring plan and forward it to the European Commission for approval."

He said the Commission had approved a restructuring plan for Brodosplit at once and that he did not expect any delays with the one for Uljanik. He added that Brodosplit was "not interested in the real estate business", only in shipbuilding. "We would do the same thing we did in Brodosplit, which is efficient business on the world shipbuilding market and generating profit without state aid."

Debeljak said that if Uljanik and 3. Maj were to fold, the consequences for shipbuilding in Croatia would be grave, including for Brodosplit, at a time when the market had improved.

He said he wanted Croatia's shipbuilding to be strong, competitive and profitable, recalling that in 163 years Uljanik and 3. Maj had built all types of ships, delivering them worldwide. He said salvaging the two docks was important for keeping jobs as well as for progress in technology, education and science.

Asked about the impact of Brodosplit's engagement in the Uljanik Group, Debeljak said Croatia would have three large shipyards instead of one, "which would operate successfully and profitably, improving the balance of industrial production and exports without state aid."

He said Croatian shipyards could compete in the construction of passenger ships, and recalled that Brodosplit was building polar expedition cruise vessels for the Dutch company Oceanwide Expeditions and the US company Quark Expeditions.

More news on the Croatian shipbuilding industry can be found in the Business section.

Friday, 8 February 2019

Economy Minister Hopeful about Uljanik-Brodosplit Future

ZAGREB, February 8, 2019 - The Minister of Economy, Entrepreneurship and Crafts, Darko Horvat, said on Thursday that good prospects existed for restructuring of Uljanik if the new strategic partner proved to be financially capable, otherwise serious problems would occur because there was no more time for salvaging shipbuilding in Rijeka and Pula.

The management and supervisory boards of the Uljanik shipbuilding group on Thursday selected the Brodograđevna Industrija Split, or Brodosplit, as the strategic partner and an agreement will be concluded to regulate mutual rights and obligations to as soon as possible draw up an acceptable and implementable restructuring programme for the Uljanik company and shipyard.

"If... we get clear indicators that, in addition to the strategic partner's wish to enter the restructuring phase, it shows that it is financially capable of it, I think that a chance exists," Horvat told reporters in Government House.

"If during the making of the restructuring programme it is established or we get clear information that the strategic partner doesn't have that financial ability, I'm afraid that we will have a serious problem because there is no time left to secure a new life for shipbuilding in Rijeka and Pula," Horvat warned.

He added that the strategic partners (Brodosplit & Fincantieri) claimed in their bid that they had the necessary financial ability for Uljanik's restructuring and submitted financial data showing that they are solvent companies.

Until such time that the strategic partner proves that it has that ability, "the strategic partnership is a potential with good wishes and very little possibilities."

Answering a reporter's question, Horvat said that the bid was submitted jointly by the Brodograđevna Industrija Split, owned by the DIV Group, and the Italian shipbuilder Fincantieri at a ratio of 70% to 30%.

He added that negotiations were underway with a client for a new ship for which the state has issued guarantees in the amount of 126 million euro. He warned that the state will have to pay that guarantee if the ship is not completed or if Uljanik goes bankrupt. That is why the state wants the ship to be built and estimates that that requires about 22 million euro.

"How that burden will be shared with the client is a matter of negotiation and I hope that in the next 10 days or so that will be completed. Whatever we invest in completing the ship will give us a chance to not only halve the 1.7 billion kuna Finance Minister Zdravko Marić is speaking about, but to save 1 billion kuna," Horvat said.

Asked whether he was satisfied with the choice of the strategic partner, Horvat said that he would refrain from making any subjective assessments and that he considered as relevant the financial reports about the status of Brodosplit and Fincantieri for 2016 and 2017 that were included in the bid. They show good business results, which offers hope that the strategic partners will use their know-how to reduce the huge deficit in the business accounts of the 3. Maj and Uljanik docks, said Horvat.

Asked whether Brodosplit used state money earmarked for restructuring in 2017 as intended, Horvat said that the ministry monitored Croatia's shipbuilding and that this information was available to the public on an annual basis.

"I'm certain that the management board carefully analysed all those reports over the past few days. Should there be any need for some other bodies to become involved in any analysis before the restructuring programme is adopted, similarly to the start of 2017, when we conducted an inspection of how funds and grants for Uljanik were expended, I think that there is no reason why we shouldn't be able to check the situation and status of the dock in Split as well," Horvat said.

He did not wish to specify how much Uljanik's bailout would cost taxpayers. He added that reports saying that the restructuring of the Rijeka and Pula docks could cost 1.2 billion didn't come from the ministry. I would like to ask those who presented that data, how they came to that figure and who their source was, he said.

Finance Minister Zdravko Marić did not want to comment on how much the restructuring of the Uljanik group could cost and repeated how much had been paid to date in enforced guarantees. "To date, we've paid 2.545 billion kuna in 2018 and payments have continued in 2019. In January an additional 250 million kuna was paid in enforced guarantees. We are approaching the amount of about 2.8 billion kuna, which is in line with our initial estimates at the time when the crisis broke out," Marić told reporters.

When reminded that he said that this year 1.5 billion kuna would be paid in state guarantees for Uljanik, Marić reiterated that his ministry estimated that a portion of that amount would very likely have to be paid.

He added that construction work on a big ship, which was also the most valuable vessel under construction, was nearing completion and that he hoped a solution for that ship would be found and that guarantees would not have to be paid for it.

Marić did not wish to comment on speculation that the strategic partners estimated that the state would have to contribute to Uljanik's bailout with about 10 billion kuna. He also didn't want to comment on previous statements by Minister Horvat that Uljanik's restructuring would cost about 800 million euro and that the state would have to pay half of that.

He reiterated though that he had always advocated that the integrity of state guarantees had to be secured and that if the state issued a guarantee, it had to settle its obligations and pay guarantees. On the other hand, I have said many times that the question should be asked why so many guarantees have been issued and how, he said.

More news on the Croatian shipbuilding industry can be found in the Business section.

Thursday, 7 February 2019

Brodosplit Selected as Strategic Partner for Uljanik

ZAGREB, February 7, 2019 - Brodograđevna Industrija Split, or Brodosplit, has been selected as the strategic partner for the ailing Pula-based Uljanik shipyard, Uljanik announced in a statement via the Zagreb Stock Exchange on Thursday.

The decision was made at a joint meeting of the Pula shipyard's management and supervisory boards on Thursday.

An agreement will be concluded with the selected strategic partner to regulate mutual rights and obligations. Under the agreement, the strategic partner will be required to draw up an acceptable and implementable restructuring programme for the Uljanik company and shipyard, the statement said.

The selected strategic partner will be allowed to enter the ownership structure of the Uljanik company through recapitalisation, as decided by the General Assembly, it added.

On December 21, the Pula-based terminated the strategic partnership with Kermas Energija and initiated a procedure for the selection of a new strategic partner.

More news on the Pula shipyard can be found in the Business section.

Tuesday, 29 January 2019

Brodosplit Owner Confirms Interest in Uljanik Shipyard

ZAGREB, January 29, 2019 - The President of the Brodosplit shipyard Management Board, Tomislav Debeljak, said on Monday that following due diligence, his DIV company and its partners had submitted a bid for the restructure of the Uljanik Group and underlined that his company had references in the form of equity of 1.7 billion kuna and a debt of 296 million kuna.

"We conducted due diligence in Uljanik and submitted a bid for the restructuring programme," Debeljak told reporters at the Brodosplit dock where the start of construction of a polar cruise ship was launched, for the Quark Expeditions company which is part of the Travelopia Group.

Debeljak told reporters that he could not disclose the financial details of the bid however he underlined that DIV had a partnership with the Italian Fincantieri Group and "large and respectable banks who have sent letters of intent."

"As far as we are concerned as a company, the DIV Group has an equity of 1.7 billion kuna and a debt of just 296 million kuna. That means that our debt is far less than that of some large, quality companies and even some insurance companies. We have a truly good financial position," he said.

He added that the Brodosplit dock has shown that shipbuilding in Croatia can be positive and of good quality. He added that Brodosplit is currently preparing a study that will show what positive shipbuilding means and what negative shipbuilding is, adding that for the past three years, the Split-based dock has had positive business results.

"We have shown that we have references in the examples of the defunct Tvik company in Knin, the defunct Švrljiga factory in Serbia that we bought and, let's say the once defunct Brodosplit whose equity was deeply in the red and have shown what we can and intend to do in Uljanik or anywhere else in some other shipyard in Europe. We have the will, know-how, desire and management capacities to expand," Debeljak concluded.

In other Uljanik related news, deputy leader of the Adriatic Union, Boris Cerovac, said on Monday that news that the Commercial Court had received an application from the FINA financial agency requesting bankruptcy proceedings against the Uljanik shipyard joint-stock company was to be expected.

FINA notes that as of 21 January the Uljanik shipyard has unsettled payments that are more than 120 days overdue and amount to a total of 75.8 million kuna.

"That was absolutely to be expected because we knew that January 21 was the 120th day that the company's accounts were blocked," Cerovac told HINA. He expects the pre-bankruptcy trustee to determine the true situation and that it isn't necessary to launch bankruptcy proceedings if the restructuring programme proposed by a new strategic partner will "hold water."

FINA notes that Uljanik has 1,400 employees and about twenty accounts and term deposits in five commercial banks and that FINA has other information concerning the company's assets. The news of the bankruptcy proceedings comes after Uljanik's management board reported that a client from Luxembourg, CLdN, had unilaterally withdrawn from a contract for the construction of a ship.

Prior to that Uljanik has unilaterally cancelled a contract for another client and the latest cancellation is just another in this crisis situation in Uljanik.

Cerovac added that the union doesn't have any official information concerning a potential strategic partner and who has submitted bids for the company.

More news on the Uljanik shipyard can be found in the Business section.

Saturday, 26 January 2019

Brodosplit and Fincantieri Make Offer for Uljanik Shipyard

ZAGREB, January 26, 2019 - Brodosplit, in partnership with Italy's Fincantieri Group, has made an offer for the restructuring of the ailing Uljanik shipbuilding group, the Split-based shipyard announced on Friday evening.

"We can confirm that Brodosplit, in partnership with the Fincantieri Group, today submitted a bid for the restructuring of the Uljanik Group," Brodosplit said in a brief statement.

The company said it could not discuss details of the offer before it was examined by the management of the Uljanik Group and relevant state institutions. Brodosplit has earlier signed several cooperation agreements with the Italian group.

The CEO of the Pula shipyard, Emil Bulić, said earlier on Friday that six companies had conducted due diligence at the shipyard, based in the northern Adriatic city of Pula. The process was completed at 6pm and the deadline for the submission of a binding offer expired at 8pm on Friday.

Uljanik's management are expected to present the offers to Economy Minister Darko Horvat on Monday.

More news on the Croatian shipbuilding industry can be found in the Business section.

Thursday, 10 January 2019

Brodosplit Constructing Two 'Elite' Ships Set to Debut in 2019

The record 24 new cruise ships will debut in 2019, representing a wide range including mega boats, about a dozen expedition vessels, luxurious yachts, and two built by Brodosplit. 

Thursday, 4 October 2018

Brodosplit Completing Largest Sailboat in the World

The sailboat is over 160 meters long with a surface area of over 6,300 square meters.

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