Announcement from Eimskip

For the past day’s media has covered the sale of two former Eimskip vessels that ended up being recycled in India.

Eimskip takes the matter seriously as the Company, its management, and employees place great emphasis on social responsibility in their work and have long paid attention to environmental issues in their operations.

Although the company believes that it complied with laws and regulations in the sale process, it is clear that the Company could have made greater requirements towards the buyer in light of the age of the vessels. That could be done by including a provision in the sales contract that if the vessels should be recycled, it would be done in a recycling yard that complies with European standards. Eimskip apologizes for not doing so.

The main activities of the buyer are not solely to buy vessels for recycling, but also to charter and sell for further trading. From the sale of Eimskip’s vessels in December 2019 until the spring of 2020, the Company’s communication with the buyer and his requirements for equipment and condition of the vessels indicated that the buyer would operate the vessels longer than they were.

The sale of the vessels was not an action by the Company to profit from higher recycling prices in other parts of the world. As previously stated, the sales price of the two vessels was USD 3.9 million. On the other hand, Eimskip paid the owner a total of USD 1.3 million in charter fee during the lease period. The Company considers it important to inform that the sales price was only slightly higher than the price in December 2019 at a recycling yard in Turkey, which is on the European list of ship recycling facilities that may recycle European vessels.

The Company is working on obtaining all data and information on the matter and will subsequently review its processes and develop a clearer policy regarding how its vessel fleet is managed and maintained in terms of age and divestment.

Vilhelm Már Þorsteinsson, CEO:
“There is consensus among Eimskip’s Board of Directors and executive management to learn from the incident and adapt the current social and environmental policy to ensure that such occurrences, which are not in line with Company’s values and emphases, do not recur.”

For further information please contact Edda Rut Björnsdóttir, Executive Vice President of Human Resources & Communications via phone (+354) 825-3399 or investors@eimskip.is.