RMK Marine signs $325 mln contract to build coastguard boats

RMK Marine, a large shipyard in Tuzla, signed a $325 million contract on Tuesday to build four military search and rescue boats for the Turkish Coast Guard. The shipyard will become Koç Holding's third arm in its defense business, after armored vehicles maker Otokar and software and systems group Koç Sistem.

“This is the first time a private Turkish shipyard has been tasked to build boats of this size,” said Kudret Onen, a senior executive at Koç Holding, RMK Marine's parent company and Turkey's top industrial conglomerate.

RMK Marine won the tender for the contract last summer, and the contract was signed on Jan. 16 at a ceremony attended by Defense Minister Vecdi Gönül and Undersecretary for Defense Industries Murad Bayar.

RMK Marine, based in Tuzla, Istanbul, will build the Sirio class boats under license from Italy's Fincantieri, a subsidiary of defense giant Finmeccanica. Under the six-year program, the first boat will be delivered in 2010 and the remaining three by the end of 2011. Engines will be supplied by Germany's MTU.

The military-owned electronics concern Aselsan has been selected as the prime local contractor and will design and supply the command and control, communications and warfare systems. The planned vessels will be 90 meters long and 12 meters wide, with a maximum speed of 22 knots.

"In the defense business,” Onen explained, “You either set up a company exclusively targeting defense contracts or start with civilian business and over time begin to win military contracts, too. We are aiming at the latter strategy.”

This is exactly how Otokar works. The company began as a commercial vehicles manufacturer but has become a defense business too, exporting $100 million worth of armored vehicles every year.

“We hope RMK Marine will follow the Otokar example,” said Onen.

RMK Marine's annual turnover in civilian boat building runs at $50 million.