Eimskip, Containerships and Kursiu Linija form Joint Venture

Thursday, September 28, 2006
Shipping and logistics company Eimskip, Lithuania's Kursiu Linija and Finnish shipping and container company Container Finance Ltd have joined forces to create a door-to-door logistics providers. The new joint-venture company Containerships Group will be based in Helsinki and will operate eleven ships on services linking east and west Europe, the Baltic States and Russia. It will be the cornerstone of a much larger alliance including the services of its parent companies.

Eimskip, which earlier this year completed the purchase of Kursiu Linija, has purchased 65 per cent of Containerships Group, the shipowning and logistics arm of Finland's Container Finance Ltd. Kursiu Linija will become a subsidiary of Containerships Group. The operations of Containerships Group and Kursiu Linija will be integrated to improve service and achieve synergies, but each will retain its trading identity.

The two companies will jointly operate 11 vessels in the Baltic Sea region, have an annual turnover of about 200 million euros and will employ more than 500 people. The vessels, with frequent sailing schedules, serve major ports in Russia (St. Petersburg and Kaliningrad) the Baltic States (Klaipeda, Liepaja and Gdansk) and in Europe (including. Hamburg, Bremerhaven, Rotterdam, Teesport and Immingham) The parties have agreed upon an option arrangement that in time enables Eimskip to obtain 100 per cent ownership of Containerships Group. The purchase price for Eimskip's 65 per cent equity stake, which is undisclosed, will be financed by Eimskip's equity and with debt financing. Containerships will form a part of the financial statements of Eimskip as of 1 November 2006 being the commencement of the first quarter for Eimskip's next financial year, ending 31 October 2007. Taken with Eimskip's operations the joint venture signifies the forming of a transportation alliance that will operate about 50 vessels and a wide range of modern container units, as well as an extensive office network. This venture will be Europe's largest transportation alliance. Containerships Group will be well placed to offer high levels of customer service, a strong and interesting workplace to its employees, as well as a solid business partnership for all its stakeholders. The shareholder value of the joint venture is expected to increase due to the current strong market share of the company combined with the significant growth opportunities particularly in the former Soviet Union and the Baltic States.

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