Davie completes purchase of the assets of Helsinki Shipyard

Helsinki Shipyard is one of the world's leading builders of Arctic tonnage. [Image: Davie]

Canada’s Davie Shipbuilding today reported that it has finalized the acquisition of the assets of Finland’s Helsinki Shipyard Oy (HSO). This completes a deal that Davie first revealed was in the works back in March this year when it exercised an exclusive option to purchase the shipyard’s assets. This was followed in April by the signing of a business purchase agreement and, on July 4, Davie secured a new 50-year land lease from the City of Helsinki.

Helsinki Shipyard had previously been owned by Cyprus-based Algador Holdings. That company is owned by Russians Rishat Bagautdinov and Vladimir Kasyanenko, whose companies include Russia’s largest river cruise ship operator, Vodohod LLC. Algador bought the yard from Russia’s sanctioned United Shipbuilding Corporation (USC) back in 2019. USC had bought it in 2010. The yard is one of the world’s leading builders of Arctic tonnage and, while neither Bagautdinov or Kasyanenko are sanctioned themselves, general sanctions have prevented the yard from exporting ships to its traditional Russian customers.

“We have gained a strong, stable and competent operator from a reputable country for our shipyard operations,” said the Mayor of Helsinki Juhana Vartiainen. “Versatile and vibrant business activity enables the success of Helsinki and enhances the well-being of our people. This is very welcome and happy news for all Helsinki residents.”

Today, Davie said that the transaction combines the skills, experience and capabilities of two leaders in Arctic shipbuilding and other high-value products.

“While the Canadian and Finnish shipyard will be separate legal and operating entities, the business headquarters will remain in Quebec,” said Davie. “The transaction will create opportunities for employees, encourage collaboration, facilitate the transfer of know-how, provide access to resources, and stimulate export potential.”

“This is the best possible news for Helsinki Shipyard, our talented workforce and our supply chain,” said Helsinki Shipyard’s managing director Kim Salmi. “After months of planning, our top priority is to rapidly return this business to what it does best – designing and building world-class ships quickly, efficiently and cost effectively.”

Though the details of the business purchase agreement are confidential, the transaction was made possible by a combination of Davie’s own funds and by EUR 77 million (CAD110 million) of financing from the Quebec government consisting of an equity investment of EUR 30 million (CAD 43 million) and a loan of EUR 47 million (CAD 67 million). A significant proportion of the funds will go to ensuring the shipyard has working capital while it gets up and running and secures new business.

Wille Rydman, Finland’s Minister of Economic Affairs “Thanks to the new owner, the future of the shipyard and the entire Finnish marine industry looks brighter.” He added: “It is also very positive for the Finnish state that the change of ownership took place on market terms.” In other words, no Finnish state funding was involved.

Davie notes that the Canadian government has looked favorably on the potential synergies resulting from the transaction for the construction of icebreakers under the National Shipbuilding Strategy.

“We are delighted to bring two historic and highly complementary businesses together,” said James Davies, Davie’s president, CEO and co-owner. “It would not have been possible without the support of Quebec, the City of Helsinki, Finland and Canada. We are confident our talented people and world-class supply chain will quickly form the preeminent global center of excellence for green Arctic shipbuilding, and other specialized products. Empowered by Helsinki shipyard’s unique know-how, Quebec can also more efficiently deliver Canada’s polar icebreaker order book, which is the western world’s largest.”

“It is with great pride that we see Davie acquire a world-class shipbuilding jewel, boosting the efficiency of icebreaker and ferry construction as part of the National Shipbuilding Strategy,” said Jean-Yves Duclos, Canada’s Minister of Public Services and Procurement. “This acquisition will bring a clear advantage in terms of supply chain cost management through increased purchasing power, while maximizing the long-term economic impact for Canada and the greater Quebec City region. Finally, the transaction will also open up new international markets for the local supply chain. This is yet another step towards making the Quebec City region a world-class maritime hub.”