Under the agreement, OSM will set up a subsidiary in Finland responsible for the crewing and maintenance of vessels previously under the management by Neste Shipping that continue to be used by Neste Oil. The intention is to transfer the shore and seagoing personnel currently employed by Neste Shipping`s ship management functions to OSM`s new Finnish subsidiary during spring 2014. Neste Shipping`s ship management functions currently employ around 300 people at sea and 17 people on shore. Neste Shipping`s chartering functions will be retained and integrated to the Neste Oil organization.
"Norwegian-based OSM was chosen after a careful review of a number of possible partners," says Arvo Ruotsalainen, Neste Shipping`s Managing Director. "OSM`s good reputation and safety record, and capabilities in terms of developing ship management functions and leveraging the specialist expertise of our personnel, all contributed to our choice. We also believe that OSM will be able to offer our fleet personnel a wider range of opportunities than Neste Shipping would have been able to, as a much smaller company in the ship management field."
Statutory employer-employee negotiations covering all of Neste Shipping`s shore and seagoing personnel were held during October and November last year as part of the plan to outsource the company`s ship management functions. All personnel currently employed in these functions will be able to transfer to OSM`s Finnish subsidiary as existing employees.
Background to the restructuring
The restructuring of Neste Shipping`s operations is based on Neste Oil`s desire to reinforce its focus on developing its core business based on cleaner traffic solutions. In addition to outsourcing ship management functions, Neste Oil will sell its key vessels to companies jointly owned by Finland`s National Emergency Supply Agency and the Ilmarinen Mutual Pension Insurance Company, from which it will charter them back on long-term agreements. As part of the restructuring, Neste Oil will set up an asset management company to manage and administer the vessel assets, together with the Ilmarinen Mutual Pension Insurance Company and the National Emergency Supply Agency. In addition, Neste Oil plans to sell its other vessels later. The decision to restructure the shipping business was announced in detail in a Stock Exchange Release issued on 19 September 2013.