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Novosti (Russia): President Putin signs decree to merge two largest shipping cos-1

18:39 | 20/ 06/ 2007
(Recasts headline, lead, adds details, background in paras 3-9)

NOVO-OGARYOVO (near Moscow), June 20 (RIA Novosti) – Russian President Vladimir Putin said Wednesday he had signed a decree to merge two leading tanker companies, Sovkomflot and Novoship, in a bid to raise the shipping sector’s international competitiveness.

At a meeting with Sovkomflot General Director Sergei Frank, the president said: “I have signed a resolution to create a new company on the basis of two existing ones.”

The government is expected to transfer its 67% stake in Novoship to Sovkomflot, 100% owned by the state, under a project drafted by the economics ministry and Sovkomflot management. Frank said the new tanker company would be on the list of the world’s five largest shipping companies with close to $5-billion-worth assets.

Frank said the merger would be a major backing to energy projects on the Far East and Arctic shelves, including Sakhalin I and II.

“The consolidation of the two companies’ assets will give strong and reliable support to major projects on Russia’s continental shelf and future liquefied gas shipments …,” he said at the president’s country residence.

The customers of Sovkomflot, which specializes in the transportation of energy products, include Gazprom [RTS: GAZP], Shell, Exxon, ConocoPhillips, LUKoil [RTS: LKOH], and Gaz de France.

And the sea carrier and state-controlled Rosneft [RTS: ROSN] signed a deal in January to set up a joint venture to service the sea component of the oil company’s continental shelf projects.

Frank said the company, which owns a fleet of 56 vessels with a total deadweight of over 4.3 million tons, had ordered another 20 tankers with a total deadweight of about 2 million tons largely from domestic shipbuilders paying 3 billion rubles ($116 million) to them last year.

Novoship, Russia’s second largest tanker company, has 58 ships with a total deadweight of 3.5 billion tons.

http://en.rian.ru/russia/20070620/67539814.html

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