The well-known European shipbuilding Germany Meyer Werft has just announced the success of the “highest-value orders in history”, and then it was revealed that the German government may be taken over, in order to avoid closure.
According to German media reports, the century-old shipyard, founded in 1795, is in a “very difficult situation”. Despite a relatively good orderbook, the shipbuilder needs funds to pay its employees by September 15 to avoid bankruptcy.
In addition, in order to finance the construction of new ships, Meyer Werft will have to raise more than €2.7bn ($2.96bn) by the end of 2027.
This is because some contracts for newbuildings were signed before the epidemic, and since then energy and material prices have risen sharply. This is one of the main reasons why Meyer Werft is facing a financial crisis.
According to reports, due to the lack of external investors, the German federal government and the state of Lower Saxony investment to take over the shipyard is increasingly likely.
However, in a statement released to local media, a German government spokesman noted that the German government has not yet decided whether it will intervene and, if so, how.
“If the government decides to give up, the Meyer Werft will have to close and some 3,300 people will lose their jobs in the Papenburg alone (where the Meyer Werft is headquartered),” the German media said.
The modality being negotiated is said to be the acquisition of 90% of Meyer Werft’s shares by the government, with the German federation and the state of Lower Saxony paying €200 mn each. In addition, the government would provide a loan guarantee of €2.8 bn for the shipyard.
It is reported that the German government is likely to take over a majority stake and Meyer Werft will become a de facto state-owned shipyard. However, as long as the shipyard finds investors before 2028, it can avoid the fate of “nationalization”.
On August 12, Meyer Werft announced on its website that it had successfully received an order for four luxury cruise ships from Disney Cruise Line, which became the “highest-value order ever” for Meyer Werft.
Meyer Werft did not disclose the value of the order, but said that the order is the shipyard’s “highest value order ever”. As a reference, in July this year, Meyer Werft and Japan’s Oriental Land Company signed a contract to build a Disney Wish class cruise ship, according to Oriental Land Company news release, the ship’s gross tonnage is about 140,000, with 1,250 staterooms, accommodating about 4,000 passengers and about 1,500 crew members. The total investment in the project is about 330 bn yen ($2.23 bn). If this calculation, the total value of the four new cruise ships may be more than $8.9 bn.
According to Meyer Werft’s official website, the company has built 58 luxury cruise ships to date and currently has three shipyards, Meyer werft in Papenburg, Neptun werft in Rostock and Meyer turku in Finland.
Including the latest order, Meyer Werft currently holds orders for 10 cruise ships, one research vessel and four offshore conversion platforms with deliveries scheduled until 2031.
