Tuesday, September 6, 2011

BHIC to return shipyard, dock to Ghana

KUALA LUMPUR: BOUSTEAD HEAVY INDUSTRIES CORP []oration Bhd (BHIC) is returning the Tema Shipyard and Drydock Company Ltd in Ghana back to the government after the proposed joint venture proposals, agreed upon in November 1996, proved difficult to work out.

BHIC said on Tuesday, Sept 6 the goals of the JV agreement were difficult to realise, which led the Ghanaian government seeking to regain control of the shipyard in nearly four years later in 2010.

Ghana and the Penang Shipbuilding and CONSTRUCTION [] Sdn Bhd, now known as Boustead Penang Shipyard Sdn Bhd had entered into a JV, where in the Ghanaian government divested 60% of its interest in the shipyard and drydock. This resulted in the setting up of PSC Tema Shipyard Ltd.

'Unfortunately, the goals of the JVA have proven difficult to realise and, in 2010, the Ghanaian government initiated action to regain control of the shipyard,' it said.

BHIC said the numerous and lengthy negotiations finally reached a deadlock, principally over matters related to shareholding structure and management control.

The latest development was on Aug 18, 2011, when a delegation from the President of Ghana, John Atta Mills, met with Prime Minister Datuk Sri Najib Tun Razak and conveyed the President of Ghana's response to the deadlocked state of negotiations.

'As a result of this exchange, it has been recognised by both sides that it is in their mutual interests for the future ownership of the yard to revert to the Republic of Ghana,' it said.

BHIC said in the spirit of South-South cooperation, the parties agreed to negotiate an outline framework for a structured and well organised transfer to Ghana of the entire 60% of the shares in PSC Tema Shipyard held by Boustead Penang Shipyard.

'It is the hope and expectation of both parties that these arrangements will be amicably concluded not later than Dec 31, 2011.

'This transaction is not likely to have a material impact on the results of BHIC in the 2011 financial year, or going forward,' it said.

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