 Duopoly's in the Cruise Industry
We already have a duopoly running the cruise industry with Carnival Corp.
and Royal Caribbean. Soon the same might be said of passenger ship
building. It seems Fincantieri will acquire a controlling stake in Lloyd
Werft and also the Grand Bahama shipyard. That pretty much leaves Aker as
the other major player in passenger shipbuilding, with a few other smaller
independent yards as well.
One thing I found interesting is the quote where Fincantieri states they
have reached agreements with Royal Caribbean and Carnival Corp. who "control
the yard" (Grand Bahama shipyard). This has been speculated all along
although both Royal Caribbean and Carnival have adamantly denied any
involvement except for a "small" investment role. I'm curious what they
were hiding and why they didn't want their true role made public?
It seems the cruise industry is becoming more and more like the airline
industry everyday. Certainly not a good thing except for maybe Micky
Arison, the head of Fincantieri, and some shareholders.
Ernie
From Seatrade Insider:
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Fincantieri to invest $100m in Grand Bahama Shipyard
11/4/2005
Fincantieri is to invest around $100m to take control of Grand Bahama
Shipyard, according to ceo Giuseppe Bono who confirmed also that an
agreement has been reached to buy up to 51% of Lloyd Werft in Germany(see
earlier story).
'We have already reached an agreement on all the financial and technical
issues [on Grand Bahama shipyard] with Royal Caribbean and Carnival Corp,
which control the yard,' Bono told Seatrade Insider in an exclusive
interview. 'The only decision still to be made is on how we'll take control
of the company. It could either be by buying an 80% stake, in which case
Grand Bahama Port Authority would retain the remaining 20%, or we could rent
the company on a long term lease. We'll make the decision on which option
based on fiscal convenience - an issue that is being studied by lawyers
right now.'
Bono confirmed that Attilio Tirelli, former director of Fincanteiri's Sestri
Levante shipyard, is the manager in charge of the Grand Bahama operation.
'I hope to finalise the Grand Bahama deal within the coming week,' Bono
said, adding that the investment will be made over a 10-year period. 'Our
hope is to pay it off with the profits generated by the yard itself.'
Fincantieri is also planning a second foray into ownership of a major
shiprepair player. 'We have an agreement to buy a 20% stake of Lloyd Werft
when the yard emerges from administration. This should happen in June,' Bono
told Seatrade Insider. 'Then we have an option to increase the size of our
holding to 51% in two years.' The third element of Fincantieri's grand
shiprepair plan is its Palermo shipyard.
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