November 31, 2001
Liberian maritime funds to be put in escrow?
An independent panel has recommended that the U.N. Security Council extend the arms embargo and rough diamond sanctions on Liberia.
In its report released today at UN Headquarters, the panel chaired by Martin Chungong Ayafor of Cameroon, said that despite some progress, a steady flow of new weapons had continued to enter into Liberia in violation of UN sanctions.
The group also said that Liberia's maritime registry had generated funds for opaque off-budget expenditures, including sanctions-busting, and suggested that the Security Council's sanctions committee for Liberia set up an escrow account as the ultimate destination for all revenues generated from the country's shipping and corporate registry.
Shipowners should breathe a sigh of relief at this solution. It denies the Liberian regime revenues from the maritime program without imposing penalties on the shipowning community.
Siem is new Kvaerner chief
As Kvaerner gears up for tomorrow's sure to be stormy extraordinary meeting, it announced the appointment of Kristian Siem as its new president & CEO. Siem succeeds Kjell E. Almskog who resigned his position today.
Siem (51) has been a director of the Kvaerner Board since May 2001. A Norwegian who resides in the U.K., he is Chairman of Siem Industries, an industrial holding companywith interests in offshore and onshore oil and gas drilling, and subsea construction, in Norway and the USA. He also serves on several boards of Norwegian and international companies.
Siem's remuneration for the Kvaerner job "will be established based on the average paid to CEO's in three of Norway's major industrial companies."
Harald Arnkvaern, chairman of Kvaerner, said: "Kristian Siem is an astute industrial leader -- and will take up this full-time executive role with immediate effect. He has committed to serve in this position for as long as his services can be of benefit during this important transitional period."
Northrop Grumman takes $60 million hit on cruise ships
Northrop Grumman Corporation announced today that it has stopped work on the Project America program to build two 1,900-passenger cruise ships at its Pascagoula, Miss., Ingalls Operations. This follows an earlier announcement that it had "suspended" work on the program.
This decision follows negotiations with the U.S. Maritime Administration, which has decided not to continue the guaranteed funding necessary to complete the construction of the ships. As previously announced on Oct. 25, 2001, the company said it would report a charge to operating margin of $60 million in the third quarter 2001 if Project America could not secure guaranteed funding.
Northrop Grumman said today it took pretax charges totaling $60 million in the third quarter 2001, reducing operating margin for the quarter from $285 million to $225 million. The company previously reported third quarter 2001 economic earnings of $161 million, or $1.79 per share, now revised to economic earnings of $121 million, or $1.33 per share. Under Generally Accepted Accounting Principles (GAAP), the company previously reported third quarter net income of $117 million, or $1.28 per share, now revised to $79 million, or $0.84 per share.
Approximately 1,250 employees working on Project America were affected by temporary layoffs last week. The company said it would make every effort to reassign affected employees. Immediately, about 500 employees will be reassigned to other ongoing projects at the Ingalls Operations, while another 200 employees will be transferred to Northrop Grumman's Avondale Operations facilities in Gulfport, Miss. Most of the remaining employees will be reassigned to Avondale Operations facilities in New Orleans, La.
American Classic Voyages Company (Nasdaq: AMCVQ), the parent company of Project America, filed for Chapter 11 bankruptcy protection on Oct. 19, following the tragic events of Sept. 11 and their impact on the tourism industry.
Crowley Marine Services reorganizes
Crowley Maritime Corporation announced today that has reorganized its Crowley Marine Services subsidiary into three distinct operating groups;
- Ship Assist and Escort Services,
- Petroleum Services, and
- Energy and Marine Services.
These three new business units, which will continue to operate as part of Crowley Marine Services, will be more autonomous and offer customers quicker responsiveness and flexibility through a decentralized organizational structure, said Tom Crowley Jr., chairman, president and CEO.
Senior VP and GM Steve Peterson is now managing Energy and Marine Services and will relocate from Jacksonville to Seattle. VP and GM Rob Grune is managing Ship Assist and Escort Services and VP and GM Bruce Barto is directing Petroleum Services, also from Seattle.
Previously, Crowley Marine Services was divided into East Coast and West Coast groups, Crowley said. In many cases, these two groups were dealing with the same customers and were offering the same services. Under this new structure we will have operating units that will be able to concentrate on distinct markets and customers without regard to geography.