ICG confirms sale of 'Bilbao' ferry to Russian operator for €37.7m
Published 04/12/2010 | 05:00
Irish Continental Group (ICG), which operates as Irish Ferries, has confirmed an agreement to sell its 'Bilbao' ferry to a Russian operator for €37.7m. The sale will result in a pre-tax gain of €8m to the Irish company.
In a statement to the stock exchange yesterday, ICG said it would receive the payment over a period of almost six years, with the passenger vessel being delivered to St Peter Line, which is registered in Cyprus, this month. St Peter Line operates services in the Baltic.
The 'Bilbao' is effectively being leased by ICG to St Peter Line until a final hire payment is made in 2016, transferring ownership of the ship to the Russian operator. The proceeds of the sale will be used for general corporate purposes.
ICG has owned the 'Bilbao' since 1993, when it was purchased from its Swedish owners, Viking Line, for $80m.
The vessel, previously known as the 'Pride of Bilbao' had been chartered until then by Viking, and subsequently by ICG, to P&O European Ferries, which operated the ship services between Portsmouth and Spain and also to France. NCB reckons the ship has generated charter revenue of $173m for ICG since 1993.
P&O had been operating a three-day-a-week service with the vessel and terminated that in September as its charter ended. It noted that the ship was old and was near the end of its commercial life. P&O also said the services it operated with the 'Bilbao' were loss-making.
ICG said it had received revenue of €3.5m in the current financial year from P&O for the ship charter, which resulted in a €1.5m operating profit for Irish Continental.