UK shipbuilder Harland & Wolff has agreed a new $25m loan from its US lenders to support the “ongoing stabilisation” of the business.
The company, best known for its role in building the Titanic, scored the funding from Riverstone Holdings, a New York asset management firm, after the UK government rejected its £200m ($256m) loan guarantee, ruling it too risky for taxpayers.
The Northern Irish shipbuilder was seeking to avoid falling into administration for a second time.
Chairman Malcolm Groat said: “We are grateful to our lenders in continuing their funding commitment to support Harland & Wolff Group’s ongoing stabilisation and long-term strategy objectives.”
As previously reported, the company has formally engaged Rothschild & Co as financial adviser to assess strategic options.
It also officially announced the employment termination of chief executive John Wood, who took leave of absence following the government loan guarantee rejection.
Groat said that Wood had made an “invaluable contribution” and he “wished him the very best in his future endeavours”.
The business is now officially being run by its new executive chairman, Russell Downs, a former partner and restructuring expert at accountancy firm PwC.
Harland & Wolff also said it is scrapping its planned Isles of Scilly ferry service. The service off south-west England had not begun operations and had a provisional starting date of 20 August.
Groat said: “It is regrettable that we have taken the tough decision to terminate the fast ferry, but we need to focus our energies and resources in continuing to grow the core business across our four delivery centres.”
The company employs about 1,500 people in the UK. Its main site is in Belfast and it has yards at Appledore in the west of England and at Methil and Arnish in Scotland.
