Steam Packet Warns Of Disruption To Sailings

[asitis]

2 hours ago, Omobono said:

the answer is they paid too much for the Steam Packet  disregarded the professional advice they were given regarding value  and went ahead ,in spite of the fact that Government controlled the user agreement  and without this the packet as a business was worthless except for a couple  or 20 odd yer old clapped out boats  , who came up with the £130  million plus   we will never know  except a fat  Mr Toad character  in brown shoes  was a major part of the decision process   and the same in Liverpool with the £100 million shed , all the ingredients  for a perfect balls up ,

Interesting the part Gawne played in this and the timing and way it was engineered to be the sole way forward !

I had softened my stance on this, when hearing that it was to provide revenue to Government of I think it was 12.5 million PA. I suspect that figure may be a distant memory !

[CallMeCurious]

https://smartmaritimenetwork.com/2024/02/14/manxman-gets-digital-kit-out/

Wonder if it will allow it to carry full compliment of passengers now?

For some reason I imagine the "emergency decision support" to be an inflatable Corporal Jones whilst his voice blasts out of the tannoy "Don't panic! 

Alternatively, a magic 8-ball pops up on the console. "Better not tell you now" or "Outlook not so good"

 

[John Wright]

5 hours ago, cissolt said:

Thanks John, very informative.  So we are left with two boats that can't perform their function as backup for the flakey Manxman?  

Have treasury failed to recognise these issues before buying the steam packet? Or just unwilling to admit that we need to spend even more money to ensure we have passenger backup.  

 

2 hours ago, Omobono said:

the answer is they paid too much for the Steam Packet  disregarded the professional advice they were given regarding value  and went ahead ,in spite of the fact that Government controlled the user agreement  and without this the packet as a business was worthless except for a couple  or 20 odd yer old clapped out boats  , who came up with the £130  million plus   we will never know  except a fat  Mr Toad character  in brown shoes  was a major part of the decision process   and the same in Liverpool with the £100 million shed , all the ingredients  for a perfect balls up ,

The issue and work was known and factored into the valuation of the tonnage when the Steam Packet was bought. It’s factored into the value of all second hand tonnage that isn’t upgraded already.

Im still fairly relaxed that the deal, taking over the value of loans and the rest of the purchase price being 6 years profits purchase meant continuity, safety, resilience.

No one could have predicted covid.

And someone needed to plan for, order, and finance, a new boat. Banco Sprito Santo weren’t going to do that.

[John Wright]

2 minutes ago, CallMeCurious said:

https://smartmaritimenetwork.com/2024/02/14/manxman-gets-digital-kit-out/

Wonder if it will allow it to carry full compliment of passengers now?

For some reason I imagine the "emergency decision support" to be an inflatable Corporal Jones whilst his voice blasts out of the tannoy "Don't panic! 

Alternatively, a magic 8-ball pops up on the console. "Better not tell you now" or "Outlook not so good"

 

Now isn’t that a confusingly written piece of “journalism”.

Has installed, will instal, used interchangeably.

[Roger Mexico]

10 minutes ago, John Wright said:

Now isn’t that a confusingly written piece of “journalism”.

Has installed, will instal, used interchangeably.

Translation: the Steamie has bought a load of Finnish software.  The original press release (issued a month ago) states that that they've:

installed and completed final inspection of NAPA’s full suite of stability management, emergency decision support, electronic logbooks, data reporting and integration systems

so it sounds as if it's all there now.  Indeed it may have been installed from the start and they've just been fine-tuning it.

[Andy Onchan]

16 minutes ago, John Wright said:

Now isn’t that a confusingly written piece of “journalism”.

Has installed, will instal, used interchangeably.

I'm sure that's old "news"... I seem to remember reading about state of the art IT stuff some months back.

[John Wright]

10 hours ago, Roger Mexico said:

Translation: the Steamie has bought a load of Finnish software.  The original press release (issued a month ago) states that that they've:

installed and completed final inspection of NAPA’s full suite of stability management, emergency decision support, electronic logbooks, data reporting and integration systems

so it sounds as if it's all there now.  Indeed it may have been installed from the start and they've just been fine-tuning it.

That’s my understanding. The hardware and connections were built in. Maybe the software was installed after arrival here. It’s been a calibration exercise since October..

[asitis]

14 hours ago, Omobono said:

the answer is they paid too much for the Steam Packet  disregarded the professional advice they were given regarding value  and went ahead ,in spite of the fact that Government controlled the user agreement  and without this the packet as a business was worthless except for a couple  or 20 odd yer old clapped out boats  , who came up with the £130  million plus   we will never know  except a fat  Mr Toad character  in brown shoes  was a major part of the decision process   and the same in Liverpool with the £100 million shed , all the ingredients  for a perfect balls up ,

The acid test for the purchase price is would any private entity, given the circumstances, have paid that much for the business. I've run it by a few business people I know and the resounding answer is not in a million years, given the lease Government held, and the amount of onward investment it needed !

I know the excuse about the price will be vital lifeline, but that I guess excuses many of the profligate decisions they take !

Edited February 15 by asitis

[Gladys]

43 minutes ago, asitis said:

The acid test for the purchase price is would any private entity, given the circumstances, have paid that much for the business. I've run it by a few business people I know and the resounding answer is not in a million years, given the lease Government held, and the amount of onward investment it needed !

I know the excuse about the price will be vital lifeline, but that I guess excuses many of the profligate decisions they take !

There is a lot of unquantifiable stuff in 'given the circumstances' that will add to or reduce the price any private purchaser would be willing to pay.  That is not to say the value was correct, but rather that ordinary commercial valuation analogues are not necessarily the correct ones to apply in this case. 

[John Wright]

41 minutes ago, asitis said:

The acid test for the purchase price is would any private entity, given the circumstances, have paid that much for the business. I've run it by a few business people I know and the resounding answer is not in a million years, given the lease Government held, and the amount of onward investment it needed !

I know the excuse about the price will be vital lifeline, but that I guess excuses many of the profligate decisions they take !

No, of course they wouldn’t, without a new sea services agreement. Nor would anyone build a new boat without one.

What lease?

What was paid was

value of fixed assets. 

anticipated income from next 6 years trading to end existing sea services agreement ( that’s cost neutral in case you don’t understand )

What we got was certainty and movement forward and room for manoeuvre.

Any start up, including government, would have had to build new boat and acquire freight/passenger resilience for winter and additional summer capacity.  Say £130 million. Not much suitable second hand tonnage. No six years income to be offset.

What we’ve missed out on has been reduced income due to Covid

Jury is still out on new boat.

[asitis]

15 minutes ago, John Wright said:

No, of course they wouldn’t, without a new sea services agreement. Nor would anyone build a new boat without one.

What lease?

What was paid was

value of fixed assets. 

anticipated income from next 6 years trading to end existing sea services agreement ( that’s cost neutral in case you don’t understand )

What we got was certainty and movement forward and room for manoeuvre.

Any start up, including government, would have had to build new boat and acquire freight/passenger resilience for winter and additional summer capacity.  Say £130 million. Not much suitable second hand tonnage. No six years income to be offset.

What we’ve missed out on has been reduced income due to Covid

Jury is still out on new boat.

I have close relatives who are variously, chartered accountants, managing directors and ex managing directors of CSP's and commercial lawyers (no bullshit). To a man ( and woman) none of them would have done the deal Government did on our behalf  with money which was their custodian !

Lease was my poor wording of sea services agreement, we already held that, and the SPCO were obliged to fulfil their part of that agreement.

Fixed assets ......... Two elderly ships.

"What we got was certainty and movement forward and room for manoeuvre." This is Eddie Teare's bed nights equivalent !

As the taxpayers are now into the packet for what 300 million it doesn't look a healthy position also given the ongoing costs of Liverpool which are yet to be determined.

Sorry but we'll have to disagree on this one, 300 million plus is not in the taxpayers best interests.

[John Wright]

21 minutes ago, asitis said:

I have close relatives who are variously, chartered accountants, managing directors and ex managing directors of CSP's and commercial lawyers (no bullshit). To a man ( and woman) none of them would have done the deal Government did on our behalf  with money which was their custodian !

Lease was my poor wording of sea services agreement, we already held that, and the SPCO were obliged to fulfil their part of that agreement.

Fixed assets ......... Two elderly ships.

"What we got was certainty and movement forward and room for manoeuvre." This is Eddie Teare's bed nights equivalent !

As the taxpayers are now into the packet for what 300 million it doesn't look a healthy position also given the ongoing costs of Liverpool which are yet to be determined.

Sorry but we'll have to disagree on this one, 300 million plus is not in the taxpayers best interests.

Where do you get £300 million from? 

[asitis]

24 minutes ago, John Wright said:

Where do you get £300 million from? 

Liverpool, purchase price, new boat.

[John Wright]

2 minutes ago, asitis said:

Liverpool, purchase price, new boat.

But Liverpool is nothing to do with Steam Packet purchase, ownership or anything else.

Separate and very stupid unwise decision, but totally independent of purchase and you can’t lump together. Would have been spent come what may.

To some extent you can ignore the new build cost. It’s a loan and will be repaid ( ok, should be repaid ). Whoever operated the service would have spent that.

So, that leaves the value of the tonnage. Seems reasonable. Needed to be owned to run the service. Still has a value at end.

Then the 6 years revenue purchase. As pointed out it’s neutral.

What I’m concerned about is that the arms length nature doesn’t seem to be working. The whole idea of the revenue/capital was that dividends/loan repayment would make this zero over that period.

Instead of paying £9million to government 18 months ago they went off on a frolic and bought Arrow. OK it’s a ( depreciating ) asset. But that money could have been paid to Treasury, or part of it used to make Ben compliant. Instead that was frustrated by the arms length board/management.

I don’t want to have government own or run a ferry service ( or a shed on the Mersey, for that matter ). 

Im hopeful that the current arms length deal is temporary and that once we’ve sorted out the new tonnage, Mx fettled, Manannan replacement sorted, a majority stake can be sold off, with IoMG golden share, shares reserved for Manx residents, and professional management.

[Mann O Mann]

4 hours ago, asitis said:

The acid test for the purchase price is would any private entity, given the circumstances, have paid that much for the business. I've run it by a few business people I know and the resounding answer is not in a million years, given the lease Government held, and the amount of onward investment it needed !

I know the excuse about the price will be vital lifeline, but that I guess excuses many of the profligate decisions they take !

What utter Rubbish.

The handful of local CSP directors you may have spoken to ( aka administrators ) have no clue .

An investor would bite your hand off to purchase a ferry company that has a monopoly to an island with a proven long term profitability .

I would add if the IOMSPC decide to list it would attract a great deal of interest from potential shareholders providing regular reliable returns ( as long as the IOMGOV stay out of running it !)

If the IOM Government wanted to sell the IOMSPC tomorrow ( which they should not ) they would be able to sell to many interested ship owners at a considerable mark up to the original purchase price  / operators in this  space such as Grimaldi / DFDS etc would snap it up.