Severnav Mehedinti, the latest major Romanian shipyard still state-owned has become privately-controlled following a share capital increase, wherein a company whose shareholders included Cristian Burci, who controls Prima TV television station participated.
The State Assets Resolution Authority (AVAS), which used to hold 70% in Severnav did not participate in the capital increase, so that its Severnav interest shrank to 38% accordingly.
Severnav doubled its share capital by an issue of shares with a par value of 55bn ROL, which it sold for 141bn ROL. Most of the shares were bought by two Severnav shareholders, International Railway Services and Investment Group, which have now come to own 54% in this shipyard. Cristian Burci confirmed his involvement in the deal through International Railway Services.
"This is a capital investment. Severnav is a very good company, whose operations are 100% export-oriented, which was strapped for cash. We want to conduct a financial restructuring process mainly and will discuss the restructuring of its credits, which we plan to convert from ROL into foreign currency," Burci said.
International Railway Services is a company registered in Luxembourg, which acquired 10% in Severnav from SIF Oltenia on RASDAQ in late 2002.
International Railway Services now holds 32.25%. Had it crossed the 33% threshold, it would have had to put out a tender offer to buy all the shares of Severnav, as bound to by the capital market legislation.
Burci was born in Severin and bought Meva Turnu Severin train car producer from US-based Trinity two years ago.
The other company that has become a significant Severnav shareholder is Investment Group, which owns 21.4%. This company is 90% held by a Cyprus-registered firm, Caryston Enterprises Limited, with the remaining 10% held by Jan Ionica.
He told Ziarul Financiar that he had invested in Severnav because it was a good company, but did not care to comment on how Investment Group was connected with Burci.
Severnav ended the first half of 2004 in the red, after seeing both its turnover and profits plummet last year. The shipyard's manager, Stelian Stancioiu, says the financial situation of Severnav worsened because of the lack of working capital it had to borrow from banks and of the 60% rise in the steel price, the company's main raw material. Although ship prices on the international market did go up, Severnav did not benefit from this, as this year's production was contracted in the previous years. Severnav logged 15 million euro first half turnover, higher than last year but lost 1.4 million euros. The shipyard expects to conclude the year with profits, though.
"We hope to conclude the year in the black and with 900 - 1,000bn ROL (21-24 million euro) turnover. We've got orders that cover the next year and part of 2006 and 2007," Stancioiu said.
The State had announced in the second half of 2002 that it was putting its Severnav stake up for sale. In less than a month during which a number of foreign and Romanian investors had expressed interest in acquiring it, the offering was withdrawn.
vlad.nicolaescu@zf.ro
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