Isle of Man News - POSTED Mon 11-04-2011

New owners for the Steam Packet Company

by Tessa Hawley

New owners for the Steam Packet Company

THE Isle of Man Steam Packet Company has new owners.


The company announced on Friday that after "successful refinancing" the share capital of the company has been transferred to Sealion (Isle of Man) Ltd – a company owned by the Steam Packet's banks led by Banco Espirito Santo.


Previously the share capital of the company was owned by a number of Australian pension funds and Macquarie. As of April 8, they have no on-going financial interest in the company.


A new corporate structure will also be put into place to simplify the current tiered multi-level structure of the company.


The Steam Packet Company said this arrangement would provide a long-term commitment from the new owners.


A spokesperson said: "The Steam Packet Company can now move forward on a stable footing enabling the Island-based management team to focus on delivering frequent, reliable, value-for-money services to both freight customers and passengers."


The Steam Packet Company has provided with the following information regarding the change:


What will this change in ownership mean for the Isle of Man?

The new owners, in the form of the bank group, have worked with the business since 2005 and remain committed to the ongoing successful operation of the business.


The Steam Packet Company will therefore continue to provide the lifeline freight and passenger services secured under the User Agreement with government.


Will services be affected?

A review of operations was undertaken in late 2010/early 2011 taking into account the effect upon the business of increased Mezeron competition. At that time it was announced that Snaefell would be withdrawn from the operational fleet and that fast craft services would be provided exclusively by Manannan.  


Manannan provides passengers with greater levels of comfort and sea-keeping abilities. The exclusive use of Manannan instead of the smaller Snaefell also means that capacity on all routes has increased. The Ben-my-Chree will continue with her reliable twice-daily service. It is not envisaged that there will be further alterations to services as a result of the change of ownership.


Will the User Agreement still be in place?

The User Agreement will remain in force. Its benefit to passengers has been clearly demonstrated in recent months as it has safeguarded frequent value-for-money passenger and freight services.


What has happened to Macquarie/other shareholders?

Macquarie and the Australian pension funds are no longer shareholders in the business, their shareholdings having been transferred to the new owners. They have no further financial interest in the business.


Will there be redundancies or pay cuts?
There was some small scale redundancy and reorganisation at the start of the year to reflect the current commercial circumstances under which the company is operating.


Will the new owners be trying to cut back even more on services and raise prices to increase profits?

The new owners are a group of banks focused on providing a long-term solution to allow the company to operate in a stable financial environment. The prices are regulated by the User Agreement and the owners have a vested interest in adherence to the terms of the User Agreement.


Will prices increase?

Prices are regulated by the User Agreement and can only be increased by agreement with the Department of Infrastructure and by Manx RPI each year.


Are the new owners putting the Steam Packet Company up for sale?
The new owners have indicated there is no current intention to sell the Steam Packet Company and have put in place long-term debt arrangements to support the company and its ongoing operations.


What do you think? Let us know by leaving a comment below:

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