The Steam Packet’s vessels were valued at just £4.4m as part of the deal to bring the ferry company into public ownership.

Redacted versions of previously confidential documents shown to Tynwald members ahead of the historic vote to buy the Steam Packet for £124.3m have now been made public.

One, an executive summary of a report prepared by consultants Park Partners, sets out how the ferry firm was valued.

Park says this is a ’one-time opportunity to acquire the Steam Packet at a fair/market price’.

It concludes that the company is worth more to the government than to the seller.

This is because the current owners only have certainty of cash flows over the remaining period of the existing user agreement to 2026 - but the government can benefit from the cash flows into the foreseeable future.

Park calculated the value of the Steam Packet at £120m based on its cash flows on the next 8.5 years.

The higher purchase price of £124.3m includes an adjustment to take account of the level of working capital within the business.

But the value to government, based on projected cash flows to 2042, was calculated between £169m and £222.5m over the next 24.5 years, with cashflow over that period of between £397.1m and £534.1m.

The higher valuation assumes turnover and costs grow at 3.1%, while the lower figure assumes turnover growing at 2.7% but costs growing at 3.2%.

Park says the Steam Packet’s vessels will be valued at just £4.4m by the year 2026. The value of the deal to government assumes £85m is invested in new or nearly new vessels by 2023.

A separate technical due diligence document, prepared by Braemar Technical Services and entitled ’Project Orca’, looks at the conditions of the vessels.

It ranks both the Ben-my-Chree and the Manannan as ’good’, grading them five on a scale of one to seven.

’We have found both vessels to be in a well maintained and presented operation condition,’ it states.

’They will, of course, require normal ongoing maintenance but with minimal increase in the present level of investment.’

The running hours of the Ben’s main engines are not considered excessive for a ferry operation, and provided the ’high standard and frequency of maintenance continues at the current level’, there is no reason why they cannot operate safely and efficiently for another 50,000 hours.

The chartered freighter Arrow, meanwhile, is rated ’acceptable’, and ranked four out of seven.

Braemar says this vessel is in a ’sustainable operational condition, requiring on-going maintenance and investment at present levels to prevent further deterioration’.

Under the deal approved by Tynwald last week and due to be officially signed off tomorrow (Wednesday), Treasury will purchase a 100% shareholding of the MIOM, the Steam Packet’s parent company.

The state-owned ferry company will be operated at arm’s length from government.

Some £76m of the cash transaction will be accounted for as a loan to be refinanced by the Steam Packet by raising a public bond or commercial loan, so that the investment is returned to Treasury in short order.

Consultants Park said forecast cash flows will provide an attractive return for government and warned if the company was not sold to Treasury if would likely be ’run for cash’.