Russia's Federal Fisheries Agency making steps to launch giant Rosrybflot plc

May 27, 2009 11:26

Russia's Federal Fisheries Agency is making practical steps to see to it that the giant state owned fishing company OAO Rosrybflot (plc), the decision to establish which was taken back in January 2008, would be launched within the next month or so for operating primarily on the distant grounds of the World Ocean, reports ( with reference to INTERFAX reports as per late May 2009.

The documents covering the mechanism of company making are being revised and agreed now, said head of the Agency's press-centre Alexander Saveliev.

According to Saveliev, the mechanism of creating the government owned plc company provides for a system of several correlated deals. Among other things, they are aimed at Rosrybflot's acquisition of 27 Sterkoder vessels built in 1991-1995 at the expense of credit of German KfW at the total value of 385.5 million USD. The credit under the state guarantees was given to JV Rybkomflot and two Cyprus-based companies Okhotsk Fishing Company and Bering Trawlers Ltd. Russian companies based in Kamchatka and Sakhalin became the ships' charterers.

However, both the borrowers and the charterers failed to pay back the credit and in 2001 the credit was paid off by the government owned Vnesheconombank. At present, the vessels are owned by the Cyprus-based companies and remain in mortgage with the bank.

The bank has tried to retrieve the money at court, but it has not succeeded in that. The opportunity to get back the vessels and pay off the credit has emerged when starting from 1 January 2009, according to the law on fisheries, bare boat chartered vessels of foreign jurisdiction have been prohibited to work in the Russian EEZ.

In the course of negotiations between Russia's Federal Fisheries Agency and the vessels' charterers the sides have developed the means to find the way out of the situation and prepared a pack of corresponding documents. First of all, they have worked out a contract for sale of 100% shares of Cyprus-based companies Okhotsk Fishing Company and Bering Trawlers Ltd to FGUP National Fish Resources at a token value of 2500 USD each. Besides, it is supposed to hand over to National Fish Resources 51% of the shares of the company which has chartered 12 vessels. The control stock of the charterer with 15 vessels will be handed over to National Fish Resources as a security of the pack agreement and the credit's paying off.

And the third step is for National Fish Resources to establish a new juridical person of OAO Rosrybflot (plc), into whose capital the Cyprus-based companies (by that time they will have been controlled by NFR) would contribute all the vessels built under the state guarantees. Besides, based on the mortgage NFR would receive in its capital 100% of the shares of these companies and the vessel charterers.

According to Alexander Saveliev, Rosrybflot would receive quotas for capture of 250,000 tonnes of fish out of Russia's TACs of 4.2 million per year.

OAO Rosrybloft (plc) is being established first of all for operations in international waters of the World Ocean. According to the nation's Federal Fisheries Agency, Russia may increase fish catches by 1.2-1.5 million tonnes per year and by the year 2020 it should become of the top three leading fishery nations.

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