Belfast shipbuilder Harland and Wolff has announced the business is set to move into administration.
The firm said between 50-60 immediate redundancies are expected but said that staff employed at its four shipyards are not affected.
Harland and Wolff, which famously built the Titanic, has four shipyards – one in Belfast, two in Scotland (Methil on the Firth of Forth and Arnish on the Isle of Lewis) and one in England (Appledore in north Devon).
It is the second time the business has been placed in administration in five years.
The administration process will be confined to the holding company, Harland & Wolff Group Holdings PLC, and the operational companies which run the yards are expected to continue trading.
A company statement said: “A full review of all group holdings commenced in July and has concluded that H&W Group Holdings PLC is insolvent on a balance sheet basis as per its last audited accounts and most recent management accounts.”
Insolvency practitioners Teneo will act as administrators and shares will be delisted.
The company is part of a consortium that landed a major contract to build a new fleet solid support ships for the British navy.
It had applied for a £200 million (€240 million) loan guarantee from the British government as part of efforts to restructure its finances.
However, the British government decided in August not to act as a guarantor on the lending – while also ruling out direct funding to maintain the company’s liquidity.
Harland and Wolff interim executive chairman Russell Downs said the group had faced a “very challenging time” due to historic losses and a failure to secure long-term financing.
He said: “It’s important to recognise that this is very difficult news for staff and will affect many within group.
“We will work to support our staff through this transition.
“We also know that it will be very unwelcome news for shareholders who have shown significant commitment to the business over the last five years.
“The board, the senior managers and rest of the team are committed to deliver the best outcome for the four yards and communities they serve to ensure their continued operation into the long term under new ownership.
“Unfortunately, extremely difficult decisions have had to be taken to preserve the future of our yards.
“Despite the recent challenges, the four yards have a strong capability, under new ownership and with the continuing support of their customers, to deliver UK-based ship building and leading UK-based renewables employing over 1,300 committed personnel.
“It’s critical that the business comes through its financial troubles to secure an enduring legacy worthy of its name and its past for the benefit of the UK as a whole and its communities in particular.”
Sourse: breakingnews.ie
