Tallink submits bid for Silja Line

  • 2006-02-01
  • Staff and wire reports
TALLINN - Estonia's Tallink announced that it had submitted an offer for Finland's Silja Line, a passenger shipping company that has gone up for sale due to its poor performance. Viking Line, another Finnish shipper, said it has also placed a bid.


The bidding was part of a first round process that is expected to continue until March, when a second set of bids will likely be submitted. The final sale should take place in April.

Among other possible buyers, Rederi AB Gotland and Stena Line have been mentioned, while Silja Line CEO Antti Pankakoski said more than 10 bids for the firm are expected.

However, the Finnish news agency STT reported that Sweden's Stena Line and Rederi AB Gotland did not submit bids.

Analysts have estimated Silja Line's value at some 500 million euros.

Silja Line is owned by the British-U.S. firm Sea Containers, which acquired the passenger shipping company in 2000 for 190 million euros.

Meanwhile, the Finnish daily Turun Sanomat reported last week that Viking Line may have placed a bid just to ensure that Tallink, the favorite in the sale, did not acquire the company too cheaply.

"Viking Line may be aiming to push up Silja's price so it won't fall too cheaply into Tallink's hands," the paper wrote. At the same time, the daily did not rule out the possibility that Viking just wants to buy Silja with the aim to shut it down and reduce competition on the market.

Viking Line managing director Nils-Erik Eklund said that the company placed a bid in order to develop the firm's ship traffic in the Baltic Sea.

Keijo Mehtonen, head of Tallink's Finnish operations, also said Silja would be a good acquisition. Financing it, he added, "would be no problem because the world is full of money."

In the meantime, it was announced last week that top Tallink managers have acquired more shares in the company since the initial public offering in December, with CEO Enn Pant heading the list.

As of Jan. 31, Pant had increased his shareholding to 602,900 shares, or 0.44 percent, having bought 125,200 more shares, according to data from the company's share registry. Previously Pant had held 477,700 shares.

Pant is also co-owner of Infortar, a company that is a major shareholder of Tallink.

Board members Keijo Erkki Mehtonen and Andres Hunt have bought an additional 46,000 and 45,400 shares, boosting their holdings to respectively 1,003,600 and 130,000 shares.

Infortar CEO and member of the Tallink Grupp supervisory board Ain Hanschmidt increased his holding by 35,000 shares to 313,920 shares. Another member of the Hanschmidt family, Harri Hanschmidt, bought 2,000 shares in January.

By the end of January Tallink's share price had dropped to 71.5 kroons apiece, compared with the IPO price of 82.5 kroons.