The Northern Irish shipyard group Harland & Wolff was able to avert the threat of insolvency by reaching an agreement with its lender.
The deal increases the shipbuilding company’s credit line in return for abandoning unrealisable business plans. Harland & Wolff has agreed with its existing lender, the US financial firm Riverstone on Wall Street, to increase its credit line. It will rise from £90m to £110m (approx. €130m) – the shipyard will pay 14% interest.
“We are grateful to our lenders for continuing to support the Harland & Wolff Group in its stabilisation and long-term strategic goals,” said Chairman Malcolm Groat. They look forward to working with experienced teams to help achieve these goals.
Harland & Wolff: Focus on core business
According to a report in the Guardian, part of the loan was conditional on Harland & Wolff shutting down “all non-core businesses”. This includes a fast ferry service between the Isles of Scilly and Penzance in southwest England. The service should have started in May, but the ferry was only delivered in July after long delays. Before a single passenger was able to use the service, it was discontinued; the ferry itself was returned to the Damen Group in the Netherlands. According to the company, the project was “disproportionately ambitious” in view of the situation.
Instead, the shipyard group, which employs around 1,500 people, will concentrate on its core business at its sites in Belfast (Northern Ireland), Appledore (England) and Methil and Arnish (Scotland).
The shipbuilding company, famous for building the Titanic, has been in financial difficulties for a long time. Most recently, the British government denied the company a loan of £200m, which led to the resignation of the managing director and fueled fears of job losses. The entry of private investors was also under discussion.
