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The ailing cruise line Genting Hong Kong is negotiating with the German government about a possible rescue package of 600 million US dollars to save its shipyard group MV Werften from bankruptcy.
The package, if agreed, would help continue the cruise ship construction projects at three shipyards under the supervision of MV Werften and prevent up to 3,000 employees from losing their jobs, according to a report by report The maritime executive.
Genting Hong Kong acquired MV Werften in 2016 to advance the construction of cruise ships for its Crystal Cruises and Dream Cruises cruise lines. However, the Hong Kong-based subsidiary of the Genting Group was hit particularly hard by the COVID-19 pandemic, and announced last August that it was temporarily suspending all payments to the group’s financial creditors, including interest and charter payments, in order to maintain liquidity during the period of growth to sustain COVID-19 pressures. The company had nearly $ 3.4 billion in debt at the time.
The challenge of keeping their German shipyards afloat during the pandemic has resulted in the German authorities getting sizeable back in October with a bridging loan of $ 227 million and another $ 65 million grant earlier this year Have provided help to save them from bankruptcy.
However, after a meeting late last week, the Mecklenburg-Western Pomerania Minister of Economic Affairs said the government was focusing on providing additional funding to maintain employment at the shipyards by building two ships for the Dream Cruises brand.
Such funding is unlikely to save a fourth operation, Lloyd Werft, from closure. Lloyd Werft, also acquired by Genting HK in 2016, is mainly focused on repairing cruise ships and building luxury yachts, but has reported a lack of work as there have been no cruises worldwide since early 2020.
Genting Hong Kong most recently reported a consolidated net loss of $ 742.6 million for the six months ended June 30, 2020.
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