Sunday 24 September 2017

Irish Continental bids for €75m EIB loan to cover half cost of new ferry

Irish Continental CEO Eamonn Rothwell; Flensburger Schiffbau-Gesellschaft CEO Rodiger Fuchs; Irish Ferries MD Andrew Sheen and Irish Continental CFO David Ledwidge at the German shipyard where construction of a new cruise ferry started this month
Irish Continental CEO Eamonn Rothwell; Flensburger Schiffbau-Gesellschaft CEO Rodiger Fuchs; Irish Ferries MD Andrew Sheen and Irish Continental CFO David Ledwidge at the German shipyard where construction of a new cruise ferry started this month
John Mulligan

John Mulligan

Ferry group Irish Continental (ICG) is seeking a €75m loan from the European Investment Bank (EIB) to help bankroll the €154m construction of a new vessel.

ICG, whose units include Irish Ferries, ordered a new ship last year that is currently being built at a German shipyard. Construction only began this month.

The new cruise ferry will accommodate 1,885 passengers and crew, have 435 cabins and space for 165 freight vehicles as well as 300 cars.

It's due for delivery next year. ICG expects to use the vessel on the Dublin-Holyhead route during the week and for sailings between Dublin and Cherbourg at weekends.

ICG is paying 20pc of the construction price during the construction period, with the balance payable upon delivery. ICG noted last year that it intended to use existing cash resources and loan facilities to finance the purchase.

The new ship will offer passenger facilities spread over four decks, while some cabins will have balconies.

There will also be a number of bars and restaurants, as well as a dedicated lounge for premium passengers.

It will have two cinemas as well as on board facilities for pets.

ICG, headed by CEO Eamonn Rothwell, has said the new ship will also deliver significant cost savings for the group, as well as improved route and fleet management efficiencies.

The company applied to the European Investment Bank (EIB) for the €75m loan this month and the application is currently under appraisal.

"The vessel will be constructed and operated to full EU and International Maritime Organisation (IMO) specifications and regulations," Irish Continental told the EIB in its application.

"The vessel will also be constructed to EU environmental standards and equipped for operations within emission control areas. The vessel will be EU flagged and registered and is expected to be operating on the promoter's routes between Dublin and Holyhead as well as Dublin and Cherbourg."

ICG has told the EIB that the new ship will enable it to reduce pollution and emissions through the modernisation of its fleet.

The European Union's Sulphur Directive came into force in 2015 in many parts of northern Europe, including the North Sea and the English Channel. The directive substantially reduced the level of permissible sulphur in shipping fuel, requiring ships in ICG's fleet to consume much more expensive fuel with a lower sulphur content. Ship owners can also install emissions abatement technology to adhere to the new rules.

ICG said the new ship it's introducing will have so-called emissions scrubber technology and ballast water systems that "will meet current and known future environmental regulations" and deliver optimal fuel consumption while minimising related costs.

Earlier this month, Mr Rothwell and other ICG executives visited the Flensburger Schiffbau-Gesselschaft & Co shipyard in Germany where the new vessel is being built. The cutting of the first steel plate that will be used in the construction of the 50,000 tonne ship took place.

In March, Irish Continental said that weaker sterling had been a "significant headwind" for the group during 2016, but it still managed to deliver record earnings of €83.5m.

The group - by far the dominant passenger and freight operator across the Irish Sea - said that its revenue rose 1.5pc to €325.4m last year.

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