Rescue bids roll in for German yards in crisis

Germany’s crisis-hit FSG-Nobiskrug shipyards, which filed for insolvency during the second week of December, could be rescued from collapse by industry-related German companies, the provisional insolvency administrators announced last week. Just before Christmas, the company had received a cash injection from the Schleswig-Holstein promotional bank enabling the yards in Rendsburg and Flensburg to ward off immediate closure.

Now, the administrators, Dr Christoph Morgen and Hendrik Gittermann, have revealed that several offers have been received from ‘industry-related companies’ in Germany, not financial investors. They were speaking as Daniel Günther, Schleswig-Holstein Prime Minister, and State Minister of Economic Affairs, Claus Ruhe Madsen, attended a meeting in Rendsburg at the invitation of the workers’ union, IG Metall Rendsburg.

Although negotiations are said to be well-advanced on the future of both shipyards, a complete resumption of construction work is unlikely for some time. The administrators are in close contact with the Australian ferry company, SeaRoad, which has a 210m-long RoRo vessel under construction in Flensburg.

Ordered during the pandemic in September 2021, the vessel had a contract value of more than EUR 100 million. Executives from the Australian company were travelling to Germany in mid-January to discuss latest developments. However, they remain fully committed to the project, according to reports. 

There is no quick fix, however. Insolvency proceedings for the companies are expected to begin at the start of February. This coincides with the end of insolvency substitute benefits for the 500-strong workforce.

Morgen explained: “The potential investors need a few more months before work can really start again at the shipyards. For this reason, and in order to avoid an otherwise inevitable closure of the business, all employees would have to transfer to a transfer company for a period of up to four months from February 1st. There they will receive 80% of the previous net wages. The aim is to enable as many people as possible to continue to work at the shipyards as soon as possible, as soon as suitable solutions are found.”

Gittermann added that a decision on the involvement of new investors would have to be made by the opening of the insolvency proceedings on February 1st. For this reason, the insolvency administrators are also talking to the state government of Schleswig-Holstein about possible interim financing. Nonetheless, timing is very tight.