Germany’s HDW-Ferrostaal takes over Hellenic Shipyards

Greece’s largest shipyard, Hellenic Shipyards, yesterday found itself under new ownership as the Hellenic Industrial Development Bank (ETBA), which controls 51 percent of the Greek shipyard, signed an agreement with Germany’s HDW-Ferrostaal, transferring both its stake and the remaining 49 percent held by a cooperative of shipyard workers to the German shipbuilders. Under the terms of the contract which is subject to the European Union regulatory authorities’ approval, HDW-Ferrostaal will pay 2.1 billion drachmas and participate in a 14-billion-drachma share capital increase at Hellenic Shipyards. The German offer is an improvement of 600 million drachmas on its original bid. HDW-Ferrostaal also agreed to take on the Greek shipbuilder’s obligations, including maintaining the company as a shipyard for 10 years. The German shipyard will retain the 1,400-strong workforce for six years. The deal with HDW-Ferrostaal constitutes a very significant development for the shipyard’s future, the preservation and protection of jobs and economic activity in the region, Development Minister Nikos Christodoulakis said in a statement yesterday. Hellenic Shipyards, also known as Skaramangas Shipyards, has had a checkered history. Placed under receivership in 1985 and 1992, the lossmaking operation managed to limp back into life each time after the workers’ union exerted strong pressure. And despite a string of contracts for the Greek navy, Hellenic Shipyards has accumulated massive losses over the years, reportedly now a staggering 60 billion drachmas. However, assets such as a 100-billion-drachma contract to build two gunboats for the navy and other submarine and frigate construction deals helped attract interest when the sell-off plans were announced in the summer. It is also contracted to build two passenger ships for shipping company Strintzis Lines and train carriages for the Hellenic Railways Organization. HDW-Ferrostaal is not a complete stranger to the Greek shipyard. It is also a client with a 400-billion-drachma contract with Hellenic Shipyards for the construction of submarines for the Greek navy. The successful disposal of Hellenic Shipyards is expected to facilitate the privatization of ETBA, as the government mulls over a bid from private bank Piraeus Bank and another from state-owned Agricultural Bank.

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