Titanic shipbuilder Harland & Wolff set to collapse into administration

16 September 2024, 14:00 | Updated: 16 September 2024, 14:36

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 new fleet solid support ships for the Royal Navy.

It had applied for a £200 million loan guarantee from the Government as part of efforts to restructure its finances.

However, the 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."

'Thrown into chaos'

Matt Roberts, GMB National Officer, said: “Workers, their families and whole communities now face their lives being thrown into chaos due to chronic failures in industrial strategy and corporate mismanagement.

“All the four Harland & Wolff yards are needed for our future sovereign capabilities in sectors like renewables and shipbuilding.

“The Government must now act to ensure no private company is allowed to cherry pick what parts are retained, in terms of which yards or contracts they wish to save.

"Leaving these vital yards - and the crucial FSS contract with all its promises for UK shipbuilding - to the mercy of the market is not good enough. The Government must provide support and oversight to get the market to the solution we need."

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Unite Irish regional secretary Susan Fitzgerald said: “Harland and Wolff is of huge strategic importance and it is essential that all measures are taken to protect the workforce to preserve skills and ensure continuity of employment.

“Unite has been regularly meeting the government and management to ensure the long-term future of the company’s yards and facilities.

"It is vital that the right buyer is found, failing that the government should be prepared to intervene.

“Workers at Harland & Wolff should be in no doubt that Unite has their back and will leave no stone unturned in securing a long-term viable future for the workforce.”