Ukraine investment in Norwegian shipyard

Zaliv, owned by Ukranian billionaire businessman Konstantin Zhevago, is one of Ukraine’s largest shipyards. Under the agreement, recently Bergen Groupwill sell its shipbuilding division, comprising the Fosen and BMV yards, to Zaliv. A joint venture, run between both partners, will operate Bergen’s plants. Additionally, the partners have announced that they will invest up to $50 million to develop a new joint company. The transaction is expected to be closed before the end of the current year after the approval by the anti-monopoly authorities of the Ukraine and third parties.

According to Bergen CEO Esl Soleym, the company decided to sell its shibuilding unit due to high operating costs. The cooperation with Zaliv will allow Bergen to focus on other core activities such as provision of offshore services and supply of shipboard equipment. Nikolay Kuzmenko, chairman of Zaliv, added that Zaliv will use its experience in fabrication of ship hulls and modules, allowing the new company to become a prominent player in European shipbuilding and equipment production.

The agreement should help Bergen to improve its weak financial situation, having in 2012 made a net loss of NOK 753 million based on a turnover of NOK 3.5 billion. Ukranian analysts believe that the new venture will provide significant benefits for both partners and will help attract new customers. Valentin Mikhailov, of Ukrainian magazine Ports of Ukraine, pointed out that in recent years Zaliv has become a leading supplier of ship bodies in the Eastern and Central European region, in successful competition with Chinese rivals. Cooperation with Bergen will allow Zaliv to achieve synergy in its production processes.

Zaliv Shipyard was established in 1938 on the shores of the Kerch Strait, an since 2007 has specialized in production of modules for oil and gas tankers. Zaliv operates its own design office, and supplies clients in the Netherlands, Norway and elsewhere. Since 2006 it has been part of Ukranian KrAZ holding, owned by Konstantin Zhevago.