The multi-billion euro rescue of the financially ailing Meyer Werft shipyard by the state is a done deal. The company must now be restructured.
After the budget committee of the Bundestag, the budget committee of the Lower Saxony state parliament has also given the green light for the aid. The federal and state governments are each taking a 40% stake in the Papenburg shipyard. In return, they will each pay €200m as a capital contribution.
Despite a good order situation, Meyer Werft had run into financial difficulties. The liabilities amount to €2.6bn. In addition to the purchase price, the federal and state governments are guaranteeing 80% of a credit line totalling €2.6bn, according to reports.
Rescue package for Meyer Werft
The main aim of this rescue package is to safeguard the approximately 20,000 direct and indirect jobs and the undisputed shipbuilding expertise at the traditional sites in Papenburg and Rostock. Meyer Turku in Finland is not affected.
Meyer Werft will, in future, be managed as a group with a supervisory board and group works council based in Germany. This was seen as a prerequisite for state involvement. At the same time, a restructuring program is to be implemented, which will involve job cuts. The details are to be presented in the next few days. The aim is to make the shipyard profitable again in the foreseeable future. The FDP party, in particular, had insisted that state participation should only be temporary.
Until the end, it was unclear whether and to what extent the Meyer family, led by company patriarch Bernard Meyer, would get involved. Originally, a private investor was to be found to take over the remaining €100m or just under 20% of the shares.
In the end, the clock ran down inexorably. A large loan is due for repayment on 15 September. Without state aid, the company would be insolvent.
Orders are both a curse and a blessing for Meyer
The full-order book is both a blessing and a curse. Meyer Werft is working at full capacity with the construction of cruise ships, with Disney and Royal Caribbean, among others, recently ordering further luxury liners. At the same time, the company has to advance almost €2.8bn to finance the newbuilds by the end of 2027. This is because customers will only pay the majority of the agreed amount (80%) upon delivery.
The shipbuilding capacities at the two German sites are also important for Germany in terms of defence projects and the energy transition. Meyer is already building naval tankers for the German armed forces together with NVL (Lürssen) and could also play an important role in future procurement measures. The shipyard has joined forces with the Dutch company Smulder to build converter platforms for the offshore wind farms off the German coast.
