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KUALA LUMPUR (February 23): Cruise ship operator Genting Hong Kong Ltd (Genting HK) and its partner, MV Werften, are in talks with the German federal and state governments to release additional bailout funds worth US $ 600 million (RM 2.43 billion) to keep the struggling group of shipyards afloat.
Maritime and maritime news portal The Maritime Executive reported yesterday that MV Werften stressed that negotiations for a bailout included keeping ongoing cruise ship construction projects at the three eastern shipyards and reducing of its workforce.
He added that in the meantime there are also plans to close the Lloyd Werft shipyard, owned by MV Werften, in Bremerhaven, Germany.
MV Werften added that he had started talks with unions and government authorities to launch a transition program that could see up to 1,200 of the group’s 3,000 lose their jobs.
“The prerequisite for granting a federal loan is the adaptation of the number of employees to the order situation,†said Peter Fetten, MV Werften MD.
Previously, the state of Mecklenburg-Vorpommern, where the shipyards are located, and the federal authorities provided an initial bridge loan from the German Federal Economic Stabilization Fund (FSM) worth $ 228 million ($ 921, RM 53 million).
The loan was intended to cover day-to-day operating costs, including wages and salaries of shipyard workers.
According to the Mecklenburg-Vorpommern Economy Ministry, earlier this year the shipyard group also received an additional $ 65 million (RM 262.72 million) to save the operation from insolvency.
Commenting on the financial assistance, the minister said their goal was to provide the finances necessary to maintain work and employment in the short term through the construction of the two 200,000 gross ton cruise ships currently being built for Genting’s Dream Cruises. .
Work on the first of the Global Dream cruise ships began in September 2018, followed by its sister ship a year later. MV Verften also suspended work in spring 2020 as the global supply line was affected due to the Covid-19 epidemic.
In a separate statement, commenting on the long-term slowdown in the cruise ship industry, MV Werften said he plans to refocus work on the yard to include tankers and platform ships.
In 2016, Genting HK purchased MV Werften and the latter built three ships for Genting, namely the Crystal Endeavor, as well as the Global Dream and Global 2, which are expected to be completed in 2021 and 2022, respectively.
On the Hong Kong Stock Exchange today, shares of Genting HK rose 8% to HK $ 0.54 at the time of writing, with a market value of $ 4.58 billion HK.
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