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Posts Tagged ‘Ferretti sold’


Back in January 2012 when Ferretti announced the sale to Shandong Heavy Industry Group Co I wondered how long it would take. Now here is the answer !

Below are extracts of various articles from Boat World and other Boating publications.

Quote

Ferretti Group, whose Riva unit made boats for Brigitte Bardot and Sean Connery, intends to open an assembly plant in China as its new Chinese parent seeks to drive up sales in the world’s most-populous country.

The Italian yacht maker is considering plans for the facility in Qingdao, Shandong province, Tan Xuguang, chairman of the company and of its majority-owner Shandong Heavy Industry Group-Weichai Group, told reporters in Beijing yesterday. The plant will customise vessels for the local market, he added.

Ferretti plans to boost sales in emerging markets led by China, Brazil and Russia, Mr Tan said, as the eurozone debt crisis saps demand in Europe. Shandong Heavy, China’s biggest maker of bulldozers, (Yes Bulldozers & Yachts the new Vertical Integration!) agreed to buy 75 per cent of the yacht maker from creditors in January for 178 million euros (S$280 million).

http://www.businesstimes.com.sg/premium/transport-hub/shipping/yacht-maker-ferretti-plans-open-china-plant-20120829

S-W Asia Editor’s note The Ferretti Group, in case you missed it, is a great deal more than Riva. The Group involves eight brands:

  • Ferretti – deluxe motoryachts, 15-27m
  • Pershing – high performance, high luxe, 15-35m
  • Itama – motoryachts 13-24m
  • Bertram – sport fisherman boats, 11-24m
  • Riva – open launches and flybridge cruisers, 8-35m
  • Mochi Craft – ‘lobster boats’ (its a styling thing), 12-23m
  • CRN – fully custom built aluminium megayachts, 44-90m
  • Custom Line – grp maxiyachts, 26-38m

A couple of years ago Ferretti got into a lot of hot financial water when the private equity company that owned a chunk of the business decided that it was worth nothing. Norberto Ferretti, founder of the original brand and of the Group, had to do a lot of monetary gymnastics to regain control and stop the whole thing being shut down.

Since then, business has not improved in Europe and North America, the traditional markets of the European luxury boat builders. Like everyone else, Asia (and in particular China) is being seen as The Big Market to get into. Many manufacturers have found out already that the Asian perception of boating is not quite the same as it is ‘back home’. ‘It’s a market, Jim, but not as we know it’.

European boat owners and charterers treasure their floating hotels for the peace and privacy they permit – the ‘exclusive getaway’ sort of programme. In Asia there is little point in having a big expensive boat if you don’t show it off – preferably tied up to the dock where everyone can see it – and there is no need to venture out onto that nasty, rolly, bumpy stuff, the sea. (Sooooo true)

It will be interesting to see what Ferretti China comes up with by way of ‘customising for the local market’. We know a boat builder who was quite flabbergasted when asked to build an 80′ luxury motor yacht – with one saloon/bar space (no dining facilities or galley required), a giant karaoke lounge complete with mirrored ceilings and disco-ball decor, and just one large stateroom (wonder what that was going to be used for?). And most importantly, a generator BUT NO ENGINES.

We will be watching Ferretti’s China output with great interest.

by BusinessTimes.com.sg

Unquote

That’s it I am buying a Princess Yacht now !

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Yacht Builder to the Stars Ferretti Bought by China Bulldozer Manufacturer

By Bloomberg News – Jan 10, 2012 7:05 PM GMT+0800
 
Shandong Heavy Buys Yachtmaker Ferretti

Employees stand underneath a Custom Line ‘Navetta 33 Crescendo’ yacht inside a warehouse at Ferretti SpA’s CRN shipyard in Ancona, Italy. Photographer: Alessia Pierdomenico/Bloomberg
 

Ferretti Group (FER) was sold to the state-owned parent of China’s biggest bulldozer-maker, putting the Communist nation in control of the world’s largest luxury- yacht builder.

Creditors will sell 75 percent of Ferretti (FER) for 178 million euros ($228 million) to Shandong Heavy Industry Group-Weichai Group, according to a statement handed to reporters today in Jinan, China. Royal Bank of Scotland Group Plc and Strategic Value Partners LLC will also own 12.5 percent stakes in the Forli, Italy-based boatmaker.

State-controlled Shandong Heavy plans to add superyachts to its construction and farming products after surging economic growth boosted China’s number of millionaire households 31 percent in 2010. The deal may help Ferretti, whose Riva unit made boats for Brigitte Bardot and Sean Connery, to expand in the world’s most-populous nation after a slump in sales after the 2008 financial crisis left it near bankruptcy.

China (CNGDPYOY)’s super-rich are looking at yachts and jets because the country has so much money now,” said Richard Tai, luxury- goods analyst at Shanghai-based research firm China Research & Intelligence. “It just shows China’s phenomenal economic development over the past 30 years.”

Ferretti, which also makes Ferretti, Pershing and Betram brand yachts, will retain its existing management as well as its headquarters and production facilities in Italy, according to a statement. The company’s yachts can cost more than $100 million.

Olympic Regatta

The deal, which requires approval from Italian regulators, will take three to six months to complete, Tan Xuguang, Shandong Heavy’s chairman, told reporters today. Shandong province, which controls the company, contains the city of Qingdao, a major naval base and host of the 2008 Olympic sailing regatta.

Ferretti will get 198 million euros of debt financing from Shandong Heavy, whose units include bulldozer-maker Shantui Construction Machinery Co. (000680) and Hong Kong-listed engine-maker Weichai Power Co. (2338) The deal also includes 100 million euros of new equity and a reduction in Ferretti’s debt to about 100 million euros.

The yachtmaker may be listed in Hong Kong within five years of the deal, said Tan. Ferretti sold about 17 vessels in China last year, he said. The country had about 1.11 million millionaire households in 2010, according to Boston Consulting Group.

“Ferretti is a high-end brand and Chinese consumers have not yet evolved to such high-end consumption,” Tan said. “Over the next five to ten years there will be great potential for yachts in china.”

China Yacht Demand

While there were as many as 400 dollar billionaires in China, the country only had about 100 Chinese-owned yachts longer than 60 feet as of May, according to Rupert Hoogewerf, who compiles the Hurun Report of wealthy Chinese. There were more than 7,000 yachts that size in the U.S. in 2006.

“If the Chinese can use the labor force in an intelligent way, the opportunity is spectacular,” said Marco Elser, a partner at AdviCorp Plc., a London-based investment banking firm. Still, it may take until 2020 to turn Ferretti around because of Italian labor laws, he said.

Shandong Heavy received financial advice on the deal from Citigroup Inc. (C), Houlihan Lokey and ICBC International Holdings Ltd., according to the statement. King & Wood, Bonelli Erede Pappalardo and Akerman Senterfitt (1267L) acted as legal advisers.

Edinburgh-based RBS and Strategic Value were assisted by Rothschild and Ernst & Young LLP and by the law firms Ashurst and Clifford Chance.

Sunseeker, Brunswick

The potential demand for yachts in China has lured overseas boat-builders such as Azimut Yachts, Sunseeker International Ltd. and Brunswick Corp. (BC) Domestic companies, including Xiamen Hangsheng Yacht Building Co., have also begun building superyachts

Other luxury-goods makers are targeting China as growth of less than 2 percent in Europe and the U.S. stifles demand in their traditional markets. Supercar-maker Automobili Lamborghini SpA expected to sell more vehicles in China than in the U.S. for the first time last year. Coach Inc., the biggest maker of luxury handbags in the U.S., has predicted that China will surpass Japan as its biggest overseas market within a few years.

Ferretti ceded control to lenders in 2009 when it missed a loan payment on debt used to finance its leveraged buyout. It went from planning an initial public offering in 2008 to reorganizing its debt in a matter of months as it customer base collapsed in the credit crisis.

In the 2009 debt-restructuring, a group of 100 creditors led by RBS agreed to convert some of their 1.2 billion euros of debt to equity to avert a Ferretti bankruptcy. Candover Investments Plc, which bought majority control of the yachtmaker in a 2007 leveraged buyout that valued Ferretti at about 1.5 billion euros, ceded its stake in the deal.

 
 
 
 
Shandong Heavy Buys Yachtmaker Ferretti

Employees pass a Custom Line ‘CL 124’ yacht, left, and a Custom Line ‘Navetta 33 Crescendo’ yacht, right, inside a warehouse at Ferretti SpA’s CRN shipyard in Ancona, Italy. Photographer: Alessia Pierdomenico/Bloomberg
 
 
Shandong Heavy Buys Yachtmaker Ferretti

Employees shape metal sheets for the construction of a Ferretti SpA ‘CRN 131’ mega-yacht at the company’s CRN shipyard in Ancona, Italy. Photographer: Alessia Pierdomenico/Bloomberg
 
Shandong Heavy Buys Yachtmaker Ferretti

Employees weld metal sheets during the construction of a Ferretti SpA ‘CRN 131’ mega-yacht at the company’s CRN shipyard in Ancona, Italy. Photographer: Alessia Pierdomenico/Bloomberg
 

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