Tschudi & Eitzen already held a majority stake in ESCO Holding, owner of the shipping company before the tender, but decided to invest in the company only after repurchasing it at a public tender and shaking off claims by creditors for 300 million kroons ($18 million).
"We are very happy now to be in a position to work concretely and efficiently on important issues which need to be addressed in the company," said Axel C. Eitzen, chairman of the board and part owner of Tschudi & Eitzen.
"Until now almost all management time had been spent looking back and finding short term solutions to problems. We can now address the future and I hope that we will indeed be successful in bringing stability and later profitability as shipowners, commercial line operators, shipmanagers and crew providers."
The price of the deal has not been revealed, although the company was on offer for sale between Jan. 28 and Feb. 6 at a minimum price of $1.5 million, which experts said was around one-tenth of the nominal value of the shares owned by ESCO Holding.
According to Olev Schultz, who sits on the councils of ESCO and ESCO Holding, the starting price was set in accordance with a thorough analysis of the company's business activities and its assets as well as the general state of the shipping industry, the size of its equity and ESCO's general prospects.
"There were companies from Estonia and abroad interested in the Estonian shipping company. I don't know why they gave up, but I can imagine why," he said.
Eitzen earlier told The Baltic Times that Tschudi and Eitzen did not want to invest in the company because any investments would be taken by the creditors.
As a condition of purchase Tschudi and Eitzen is obliged to invest $3 million in ESCO.
ESCO Holding's biggest creditors are Uhispank with a 100 million kroon claim and the state with a 170 million kroon claim. The state's claim is due to the company's failure in 1999 to pay for a 15 percent stake in the company.
ESCO Holding then pledged 20 percent of its ESCO shares to the state as collatoral, which it would now like to sell to the new buyer with the state's consent.
The price of this stake will reach some 5 million kroons if Tschudi & Eitzen is to pay a minimum price for the bid and will cover only 3 percent of the company's debts.
Martina Prosa, head of the Finance Ministry's loan department, said the state would take what was offered because the money received from the sales of shares was the only remaining source with which to satisfy creditors' claims.
"We haven't yet received a written offer for the 20 percent shares," she said.
"It's the management of ESCO Holding which has led the company to insolvency. If we don't give them the 20 percent stake, the company may end up bankrupt. They need to have a sole owner in order to receive a loan from a bank and continue their operations."
The Estonian business daily Aripaev accused the Norwegian company of asset-stripping, blaming it for selling over half of the fleet since the start of the privatization, taking an illegal loan from ESCO and of a number of shady transactions with Tschudi & Eitzen.
The management of Tschudi & Eitzen rejected these accusations last June, claiming that their lawyer had ensured the lawfulness of their actions and that most of the ships which had been sold were too old or incompatible with the company's strategy.