Business

Samoa to buy Forum Line

By RACHNA LAL The Samoan government is in the process of purchasing all shares in the Pacific Forum Line shipping company. The Pacific Forum Line is a South Pacific regional
03 Oct 2012 12:28

The Samoan Government is preparing to purchase all the shares in Pacific Forum Line.

By RACHNA LAL

The Samoan government is in the process of purchasing all shares in the Pacific Forum Line shipping company.
The Pacific Forum Line is a South Pacific regional shipping service, and the Fijian Government is one of the major shareholders of 12 countries which jointly own the Pacific Forum Line.
The chief executive of Pacific Forum Line, Henning Hansen, told Radio New Zealand International the Samoan government, which was an eight per cent shareholder in the company, signed on to acquire the remaining 92 per cent.
The chair of the Pacific Forum Line’s board in Samoa, Patrick Fepulea’i, confirmed a purchase of sale agreement had been signed.
Mr Fepulea’i said a settlement was yet to be finalised, but this was expected to happen next Monday and he was unable to comment further.
New Zealand company Sofrana had put in an offer to purchase the company but says it’s understood the government of Samoa invoked its right to acquire the outstanding shares.
Radio New Zealand International reported there was no sale to Sofrana, because the Samoan government would own all shares in the Pacific Forum Line.
New Zealand has 23 per cent of the company, but the Foreign Minister, Murray McCully has said the company no longer fulfills a number of its obligations.
The New Zealand Sunday Star-Times reported last week that the three majority shareholders, including Fiji, were behind the push to sell, with the board having already signed off on the plans.
Founded in 1978, Pacific Forum Line was intended to encourage economic development in the islands and provide competition to stop monopolies and cartels pushing up prices.
Despite once being profitable in recent times it has struggled.
The New Zealand Sunday-Times reported: “PFL has recently financially deteriorated, with losses totalling $14 million in the two years to June 2011.
“Net assets of the line declined to $5.1m by June 2011, and while it is understood performance in the year since has slightly improved, shareholders have been faced with a choice between selling or recapitalising.”




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