July 30 - Dockwise's wholly owned subsidiary Dockwise Yacht Transport (DYT) is to merge with Yacht Path International Inc to create a new force in premium yacht transport.
The combination of Yacht Path with DYT will create an enterprise capable of transporting yachts of any size to any destination around the globe and broaden the scope of services to any client, from private owner and charter company to brokers and shipyards.
Yacht Path will contribute its worldwide leadership in "Lift On/Lift Off" transportation: the chief mode of transport for small to medium yachts up to 80 feet, aboard ocean-going cargo and container vessels. DYT will bring a corresponding global leadership in "Float On/Float Off" transportation for large yachts up to 200 feet on its four submersible yacht carrier vessels.
In a company statement, Dockwise said that the combination of a reliable fixed schedule between cruising playgrounds and the ability to add extra voyages to new destinations with flexible tonnage will provide yacht owners with increased options for their travels.
The market for yacht transport is a clear niche market with a strong volume share of smaller yachts (<80ft) and the super yacht segment (>80ft) representing around 25-30 percent. Demand for yacht transportation services is mainly generated by yacht owners and charter companies seeking expansion of their cruising grounds to benefit from two seasons within one year (e.g. Mediterranean in the summer and Caribbean in the winter). The market is mainly driven by the increasing global fleet size, as a result of increasing wealth, allowing for a growing charter market and development of new yachting destinations around the world.
The signed letter of intent provides that, after successful conclusion of the due diligence investigation, the combination of the two businesses will be effected through DYT's purchase of the entire issued share capital of Yacht Path. The Yacht Path shareholder group, including members of the current management team, will in that case receive an initial cash consideration of USD 3 million and a final payment of at least USD 9 million in 2012 subject to the achievement of performance targets for the combined business. It is the intention that current managers of both DYT and Yacht Path will take seats in the management of the new combined company.
"The merger of DYT and Yacht Path is an exciting step in the evolution of a growing global niche market" said André Goedée, Chief Executive, Dockwise Ltd. "The current recession, while temporarily subduing demand, has not reversed the long-term upward trends in yacht transportation between cruising destinations. The unified company will be ideally positioned once favourable conditions return and Dockwise will enjoy significantly increased market share. Furthermore, the complementary market segments that each of the parties brings to the merger will deliver strong marketing synergies."