13 October 2024 , 20:00
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Deal to rescue owner of four UK shipyards, including Belfast shipyard that built the Titanic, could save up to 1,000 jobs
Spanish shipbuilding firm Navantia is in exclusive negotiations to buy Harland & Wolff, the owner of the Belfast shipyard that built the Titanic, in a deal that could rescue up to 1,000 jobs.
It is understood the group could take control of the group’s four yards – in Belfast; Appledore, Devon; Arnish on the Isle of Lewis; and Methil, Fife – as early as next month.
A deal is not expected to involve a pre-pack administration of the operating companies that run the yards, which could put jobs at risk. At present, only the main holding company is in administration.
Navantia has already been financially supporting Harland & Wolff to continue operating as it tries to keep alive a £1.6bn contract with the company to build three fleet solid support (FSS) ships that transport crucial supplies to aircraft carriers for the Royal Fleet Auxiliary, the civilian branch of the Royal Navy.
Under the original plans, Harland & Wolff and Navantia would each have fabricated sections of the ships in their yards in Appledore and Cádiz, respectively. The sections would then have been joined together in Belfast.
The future of the project has been plunged into doubt since Harland & Wolff’s main company was placed into administration last month.
Sources said Navantia was examining a number of options to protect the contract including a buyout and it was not yet clear which would go ahead. The details of a deal being neared were first reported by the Sunday Telegraph.
Administrators for Harland & Wolff’s main company are understood to want to secure a deal for its yards as quickly as possible so they can confirm and win new contracts.
As many as 20 companies have expressed interest in buying parts of the business in a sales process being run by Rothschild. The business controls a proposed gas storage operation in Northern Ireland, and a now scrapped ferry service to the Isles of Scilly.
The future of the shipyards had been in doubt for months as government officials raised concerns that a £200m loan guarantee could result in taxpayer losses. The business secretary, Jonathan Reynolds, in August ruled out giving the loan guarantee, which had been announced by the previous Conservative government.
Yet Reynolds also made it clear in July that he was confident that Royal Navy ships would be built in Belfast.
Russell Downs, the restructuring expert who was appointed interim executive chair at Harland & Wolff in the summer, said: “The core activities of the group’s four yards continue to trade with support of all stakeholders and we will provide an update on our strategic process when it’s timely to do so.”