Harland & Wolff, the historic shipbuilding company behind the Titanic, is once again facing financial troubles, confirming that it will enter administration for the second time in five years. The company, which operates four shipyards in the UK, including its main yard in Belfast, has appointed insolvency practitioners Teneo to oversee the process. While some staff are being made redundant, the company believes there is still a "credible pathway" for its shipyards to continue operating under new ownership.
Harland & Wolff’s current difficulties come as non-core operations are being wound down, and job cuts have begun. A small number of non-core staff and those in support roles were told on Monday that they are losing their jobs, and the company warned that further headcount reductions might be necessary depending on the progress of the sales process.
Despite these challenges, Harland & Wolff’s board remains optimistic about the future of the company’s core shipyard operations. The administration will only affect the holding company, Harland & Wolff Group Holdings plc, while the operational companies running the shipyards are expected to continue trading. Shareholders, however, will see their investments wiped out.
The company's four shipyards, located in Belfast, Appledore in England, and Methil and Arnish in Scotland, are key to its future. The shipyards have strong leadership, and according to the company’s executive chairman Russell Downs, they are working on important contracts, including projects for the Ministry of Defence. Downs stated that while the company has immediate funding needs, he believes the shipyards will generate cash in the future.
The sales process for Harland & Wolff’s shipyards is being led by Rothschild bank, with several potential buyers expressing interest. Among the interested parties is Spain’s state-owned shipbuilder Navantia, which partners with Harland & Wolff on the Fleet Solid Support (FSS) programme, building Royal Navy logistics vessels. UK defence contractor Babcock International is also reported to be a potential bidder for the Belfast shipyard.
Adding to the company’s woes, Harland & Wolff has launched an investigation into the alleged misapplication of over £25 million under its previous management. The investigation, led by accountants PwC and law firm Simmons and Simmons, aims to address customer concerns over the use of company funds. The company’s former CEO, John Woods, dismissed the allegations as "ridiculous."
While the road ahead for Harland & Wolff looks challenging, the company remains focused on finding new ownership for its shipyards and continuing its shipbuilding legacy. Chairman Russell Downs acknowledged the impact of these developments on staff and shareholders, stating that "extremely difficult decisions" have been made to secure the future of the company’s shipyards. The company aims to finalize a deal by the end of October, giving hope for the future of this iconic shipbuilder.
