The Ferretti Group was sold to the state-owned parent of China”s biggest bulldozer-maker. Creditors will sell 75% of Ferretti for 178 million euros ($228 million) to Shandong Heavy Industry Group-Weichai Group, according to a statement handed to reporters today in Jinan, China. Royal Bank of Scotland Group Plc and Strategic Value Partners LLC will also own 12.5% stakes in the Forli, Italy-based boatmaker.
Sleekly tailored with gleaming chrome accessories and luxurious saloons, the Ferretti Group designs some of the most exclusive yachts in the nautical world.
Ferretti has 8 yacht brands (Ferretti Yachts, Pershing, Itama, Bertram, Riva, Mochi Craft, CRN and Ferretti Custom Line) and owns a total of 8 shipyards.
Ferretti was forced to cede control to lenders in 2009 when it missed a loan payment on a debt and the crisis shrank its customer base.
In the 2009 debt-restructuring, a group of creditors led by RBS agreed to convert some of their debt to equity to avert a Ferretti bankruptcy.
Ferretti, which employs 2,000 people, will keep its management, headquarters and production bases in Italy.
Demand for luxury yachts in China is growing, and with a million millionaires in the country, the nation’s new rich are looking for new ways to flaunt their assets.
The number of luxury powerboats and yachts in China is expected to increase by more than 10-fold to over 10,000 by 2015.
Shandong Heavy, which makes heavy-duty industrial products, will seek a separate listing for Ferretti in Hong Kong in three to five years, Chairman Tan Xuguang said.
The deal, which requires approval from Italian regulators, will take three to six months to complete, Tan Xuguang, Shandong Heavy”s chairman, told reporters today. Shandong province, which controls the company, contains the city of Qingdao, a major naval base and host of the 2008 Olympic sailing regatta.
Ferretti will get e198 million of debt financing from Shandong Heavy, whose units include bulldozer-maker Shantui Construction Machinery Co. and Hong Kong-listed engine-maker Weichai Power Co. The deal also includes e100 million of new equity and a reduction in Ferretti”s debt to about e100 million.