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Mangalia Shipyard sets sights on deals worth $500m for 2009

11.01.2005, 00:00 6



Daewoo Mangalia Heavy Industries Shipyard (DMHI) intends to close deals worth 500 million dollars by 2009, four times higher than for 2004.



The shipyard industry is enjoying an unprecedented boom, thanks to the rally in orders by ship owners and increasing demand from Asia.



"For 2005, we project the value of production and therefore turnover will reach about 210 million dollars. This will be the first step in a business plan that aims to achieve 500 million dollars by 2009," Gheorghe Petrescu, deputy chairman of the company that manages the shipyard, told Ziarul Financiar.



Preliminary results for Daewoo Mangalia point to a turnover of 128 million dollars (105 million euros) and a declining profit rate of around 3.5%.



"Profits are lower compared to last year, when we made 5 million dollars. There are two reasons for this: the price of plate worldwide has hit us very hard because materials-related expenditures have increased; also, the strength of the domestic currency has been unfavourable to us and hurts all exporters," explained Petrescu.



Daewoo Mangalia shipyard is currently working on a 200 million-dollar contract signed last year with German ship owner Gebab for construction and delivery of four ships of the container carrier type.



The contract is accompanied by a financing and guarantee structure, in which Gebab Kozeptions und Treuhandgelleschaft pledged to pay an 80% advance on the cost of each ship, with the remaining amounts paid by the constructor during this stage.



The ships, which have a capacity of 4,550 TEU (a unit of volume corresponding to a 20 foot container), are to be delivered by 2007.



The main financial intermediary is Banca Comerciala Romana (The Romanian Commercial Bank), which is issuing letters of guarantee for three of the four ships and will secure the capital flow requested by the Mangalia shipyard. The letter of guarantee for the forth ship will be issued by US bank Citibank, according to company officials.



BCR is the main financing body in the field of shipbuilding, a sector currently enjoying strong growth.



DMHI was set up in 1997 as a joint venture. The South-Korean party holds 51% of the stock, while 49% is held by the company 2 Mai Mangalia, which is controlled by the Romanian state. Since then, Daewoo has invested over 30 million dollars, according to the latest information.



Daewoo Mangalia Heavy Industries entered the complete ship market late last year after signing a contract worth over 90 million dollars for the delivery of three oil tankers to a ship owner from Cyprus.
adrian.mirsanu@zf.ro



 

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