The National Shipping Company of Saudi Arabia “NSCSA” announced that the company signed an agreement with Arabian Agricultural Services Company “ARASCO” on Saturday 28th August, 2010 to establish a JV company to transport Dry-bulk cargo, with a capital of 200 million Saudi Riyals, 60% owned by NSCSA and 40% by ARASCO.
The activities of the new company will be to acquire, own, charter and commercially operate a fleet of dry-bulk vessels. This company is expected to start in the year 2011. Upon owning several vessels of suitable sizes for this kind of activity, weighing (76,000) DWT, the company will lease these ships on a long-term contracts to ARASCO to transport import Dry-bulk cargo.
The initial estimated investment for the new company is about 656 million Saudi Riyals, reaching almost 1,325 million Saudi Riyals during the first three years and expected to be financed 30% by the partners and 70% through financial investment institutions.
By signing this contract to establish this new company, NSCSA added the activity for dry-bulk transportation which represents about 23% of the total cargo imported to Saudi Arabia, to its other activities (Oil, Petrochemicals, General Cargo, etc). This investment is considered as one of the objectives of the company’s strategic plan implemented in the year 2009 where this activity will help the growth of profits and diversify sources of income.