Debeljak: Brodosplit submitted a ‘very, very valuable’ offer for Uljanik

The CEO of Brodosplit Tomislav Debeljak reported on Tuesday that Brodosplit has submitted a binding offer for Uljanik, stating that he is primarily interested in 3. maj, where they would produce cruise ships.

“Given the confidentiality, I would not like to go into details, but I believe our offer is very, very valuable; it is not about just one kuna but a much greater value,” Debeljak told reporters on the sidelines of the conference “The Future of Shipbuilding in Croatia,” organized by Hanza Media and Brodosplit.

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Uljanik reported on Tuesday that it has received binding letters of intent from several interested investors and that the management will propose a strategic partner to the Supervisory Board, which is expected to decide on this on Wednesday, March 28.

When asked how he currently views Uljanik and what his goals are if he succeeds in acquiring ownership, Debeljak emphasized that the Rijeka shipyard 3. maj, which is part of the Uljanik group, was a “candy” even during privatization, and that five years ago it was in a better position than Brodosplit by two billion kuna.

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“Unfortunately, 3. maj has consumed that advantage in five years and is now better than Brodosplit by about 100 million kuna. We are primarily interested in 3. maj, and again, when it comes to the restructuring of Uljanik, we are willing to help, and I believe it is our duty to help in order to save the industry in Pula and Rijeka,” said Debeljak.

He believes that these shipyards have a future, but that restructuring is crucial.

He notes that cruise ships would be produced in 3. maj, which are practically the only ones produced in the EU, “because they are the only ones that can achieve added value,” meaning they are the most profitable due to their sophistication.

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As he explained at the round table, it has long been impossible to compete with the Chinese in tanker construction, where losses have accumulated because something that does not work has been forced.

Brodosplit is, as he said, currently predominantly focused on the production of polar cruise ships, which have high environmental standards.

EIB ready to finance ‘green’ shipbuilding

The head of the Zagreb office of the European Investment Bank (EIB), Anton Kovačev, reported that the bank has a ‘green’ shipbuilding program worth 750 million euros, under which it is ready to finance the construction of ships that comply with environmental standards.

He notes that these are not loans to shipyards but to shipowners, i.e., clients. The EIB, he said, has already signed agreements with one Dutch and one French bank, and negotiations are ongoing with Nordic banks.

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“I believe we will reach such an agreement with Croatian commercial banks and that we can start building ships in Croatian shipyards,” Kovačev said.

The executive director of the German Shipbuilding and Maritime Industry Association, Reinhard Lüken, stated that shipbuilding on a global level has undergone enormous changes since the 1990s, with significant growth in Chinese and South Korean shipbuilding, while European shipyards have suffered the most.

He said that German shipbuilding, including East Germany, has lost about 85 percent of jobs compared to the 1970s, but many of those workers have found jobs in companies that are cooperatives and part of the supply chain of shipyards.

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In the past decade, German shipyards have completely changed, Lüken says, and ten years ago, 50 percent of the order books were related to cargo and container ships. Due to the inability to compete with Asian shipyards, the focus has largely shifted to the production of passenger ships, which has led to an increase in revenue, orders, and employment.

Rijeka Mayor Vojko Obersnel hopes that the restructuring of Uljanik will end successfully, emphasizing that he is primarily interested in the continuation of shipbuilding in Rijeka. He believes that such a possibility is open within the Uljanik group or outside of it.

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When asked about possible layoffs in 3. maj, Obersnel said he is aware of the idea of Uljanik’s management that, assuming the restructuring process goes through, any surplus employees would be resolved by retirement or voluntary departure.