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[Aug.21 2000]Stake of loss-making oceanliner to be auctioned
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The once sensational Oriana luxury oceanliner now docked on the Huangpu
River may soon be a sight of the past for the city as one of its major
shareholders announced on August
15 that it will auction its stake in the
profitless sightseeing attraction.
The announcement came from Hangzhou
West Lake International Tourism Culture Development Co Ltd, which holds a 85
percent stake in the liner. The other 15 percent is owned by Hangzhou Jiebai
Group Co Ltd, a department store operator.
"We are shifting to another
big project abroad, so we have to find a new, replacement investor to carry on
operating the ship, though it has been a hard decision for us to make," said
Chen Yajun, chairman and general manager of the company.
Built in
Britain, the 245-metre-long oceanliner has covered 6.5 million kilometres and
visited 108 harbours worldwide since its maiden voyage in 1960 and before its
discharge in 1986. In co-operation with Hangzhou Jiebai, the company spent 50
million yuan (US$6.05 million) purchasing the Oriana in November 1998 from
Qinhuangdao in North China's Hebei Province.
"With the aid of its fame,
we intended to turn it into a leisure and cultural facility that combined
sightseeing, cuisine, entertainment and hotel services," said Wang Yang, senior
staff member with the Shanghai Oriana Entertainment Co Ltd, the liner's business
operator.
After a 30 million yuan (US$3.63 million) renovation, the
Oriana opened its doors to visitors in Shanghai in February, 1999. Yet during
its 18-months of operation and despite more than 500,000 visitors, the luxury
liner hasn't attained expected profit levels and its operators have lost at
least two million yuan (US$241,800).
Though it has posted 30 million yuan
(US$3.63 million) in revenue, a source with the company said. The liner now
receives about 100 visitors during the week and 200 to 300 during weekends at a
price of 35 yuan(US$4.23), according to ticket sales.
"Maybe it's because
we do not specialize in this sort of business," said Wang Yang. "At least
another 50 million yuan (US$6.05 million) is needed to achieve our previous goal
to retrieve our initial investment in five years," Wang said. "And that
possibility has now been denied us with our biggest shareholder pulling
out."
Scheduled for September 28, the auction is open to domestic and
foreign investors, and the reference bid price is 60million yuan (US$7.2
million), said a source with the Shanghai International Commodity Auction Co
Ltd, which is responsible for the auction. It will be the first time investment
restructuring has occurred through auction in China, the source
said.
"Whether the liner will stay in Shanghai depends on the new
investor," said Wang. (China Daily 21-Aug-2000)
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(Editor:Farah Song) (From:China Daily)
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