Listed Estonian shipper AS Tallink Grupp announced on Thursday morning that it has signed an agreement with Rauma Marine Constructions (RMC) for the construction of a new shuttle ferry.
Tallink and RMC on Wednesday night signed an agreement of intent according to which Tallink intends to order a new passenger ferry for its Tallinn-Helsinki route.
The new vessel, which is to be built at Rauma Shipyard in Finland, is projected to cost approximately €250 million and be completed by the end of 2021.
In comparison, the Megastar, currently Tallink's newest ship, which entered service in early 2017, cost €230 million.
Tallink CEO Paavo Nõgene and board member Andres Hunt confirmed that the financing of this investment is within the company's means, and that the company's promised dividend policy will not be affected. Nõgene stressed that Tallink has been progressive in the reduction of its loan burden.
Hunt explained that in shipbuilding, it is customary for the principle payment to be made at handover, which is planned to take place approximately three years from now. "Our cash flows and earning capacity are good enough to get this financed," he said. "The majority of the money will come as a loan from banks, with a down payment of 20%."
The new vessel will have a bi-fuel engine, running primarily on liqufied natural gas (LNG), and a capacity of 2,800 passengers.
The shuttle will serve the company's Tallinn-Helsinki route, further developing an important connection between the the two capital cities. The company's goal is to build the most efficient and environmentally friendly ship on the Baltic Sea.
Over the years, a total of four Tallink Group ships have been built and two vessels designed at Rauma Shipyard. The most recent Tallink ship to be built in the Finnish shipyard was the Baltic Queen, which was completed in 2009 and serves the company's Tallinn-Stockholm route.
Over the next couple of months, Tallink Grupp and RMC will draw up a ship construction agreement and agreements regarding the financing of the ship.
Editor: Aili Vahtla