Despite massive state aid, crisis-ridden Wadan Yards in Wismar and Rostock-Warnemünde filed for bankruptcy on Friday.
“Due to unsettled questions at the shareholder level the yards were not able to access downpayments of clients in a three-digit million range for vessels under construction,” said the company in a statement. Because of that, the yards could not pay bills that were due.
“I am disappointed and angry about how the owners abandoned the yards,” said Erwin Sellering, state prime minister of Mecklenburg-Vorpommern, where the shipbuilders are located.
According to the state government the owners had not been willing to meet the obligations for all the loans and guarantees the state government and the federal government had given to the yards. For this reason they have now cut off funding.
The yard is owned by Russian FLC West and Korean STX Europe. In recent months, the yards received a considerable amount of state aid. After failing to raise bank loans at the end of 2008, Wadan yards had to be rescued by a bridging loan of €60m ($83.3m) from Mecklenburg-Vorpommern’s government.
Later, the yards received a loan of €180m from Deutsche Bank and KfW Ipex, for which the German government took over the risks. Because Wadan yards’ credit insurer no longer accepted standard security to issue a refundment guarantee for a ropax ferry for Stena Line the company recently asked for additional government guarantees.
The state government and the federal government agreed to secure the refundment guarantee, which should have enabled the yards to get downpayments up to €100m. But the government demanded that the owners participate in rescuing the yard.
The state government urged FLC West to inject at least €5m. But after the first instalment, payments stopped. STX Europe refused to confirm four own containership orders to Wadan Yards and also declined to provide a charter guarantee for two already completed containerships to enable their sale. In addition Andrej Burlakow, co-owner of FLC West, failed to produce promised newbuilding contracts he announced months ago. For these reasons, the government withdrew the guarantees.
The local court of Schwerin, which received Wadan Yard’s application for insolvency, has appointed lawyer Marc Odebrecht as insolvency administrator. For now the work on the vessels under construction at Wadan Yards will continue. The company has 12 ships on order worth E801m and employs about 2,600 staff.
“Due to unsettled questions at the shareholder level the yards were not able to access downpayments of clients in a three-digit million range for vessels under construction,” said the company in a statement. Because of that, the yards could not pay bills that were due.
“I am disappointed and angry about how the owners abandoned the yards,” said Erwin Sellering, state prime minister of Mecklenburg-Vorpommern, where the shipbuilders are located.
According to the state government the owners had not been willing to meet the obligations for all the loans and guarantees the state government and the federal government had given to the yards. For this reason they have now cut off funding.
The yard is owned by Russian FLC West and Korean STX Europe. In recent months, the yards received a considerable amount of state aid. After failing to raise bank loans at the end of 2008, Wadan yards had to be rescued by a bridging loan of €60m ($83.3m) from Mecklenburg-Vorpommern’s government.
Later, the yards received a loan of €180m from Deutsche Bank and KfW Ipex, for which the German government took over the risks. Because Wadan yards’ credit insurer no longer accepted standard security to issue a refundment guarantee for a ropax ferry for Stena Line the company recently asked for additional government guarantees.
The state government and the federal government agreed to secure the refundment guarantee, which should have enabled the yards to get downpayments up to €100m. But the government demanded that the owners participate in rescuing the yard.
The state government urged FLC West to inject at least €5m. But after the first instalment, payments stopped. STX Europe refused to confirm four own containership orders to Wadan Yards and also declined to provide a charter guarantee for two already completed containerships to enable their sale. In addition Andrej Burlakow, co-owner of FLC West, failed to produce promised newbuilding contracts he announced months ago. For these reasons, the government withdrew the guarantees.
The local court of Schwerin, which received Wadan Yard’s application for insolvency, has appointed lawyer Marc Odebrecht as insolvency administrator. For now the work on the vessels under construction at Wadan Yards will continue. The company has 12 ships on order worth E801m and employs about 2,600 staff.