Genting’s cruise ship builder in Germany to file for bankruptcy

 

An artist’s impression of the Global class of mega cruise ships from Genting-owned shipbuilder MV Werften, which is to file for bankruptcy. (MV Werften pic)

FRANKFURT: Germany-based cruise ship builder MV Werften said it will file for bankruptcy on Monday, as the coronavirus pandemic scuttled the company, which is a subsidiary of Asian tourism and casino giant Genting.

“The bankruptcy petition should be submitted today,” a spokesman for MV Werften said.

The struggling shipbuilder was taking the step after failing to secure funding for the completion of the “Global One” mega-liner, already 80% through construction, according to the company.

Designed to carry 5,000 passengers in 2,500 cabins, the huge ship had been due to leave the shipyard in 2021 – but the pandemic has knocked the company’s timetable off course and crimped its budget.

Around 600 million euros (US$679 million) is necessary to finance the completion of the vessel, for which the shipbuilder has been seeking support from the government.

The decision to declare bankruptcy came after lengthy discussions with officials in which the two sides “clearly have not found common ground”, the spokesman said.

The Global One ship sits in Wismar, one of MV Werften’s three shipyards along the Baltic coast of former eastern state Mecklenburg-Western Pomerania, where it employs around 2,000 people.

In June, the state took a stake worth 60 million euros in the business and extended a 47-million-euro loan to the company.

In all, the government has offered financial support of around 300 million euros to MV Werften since the beginning of the pandemic.

With travel still severely restricted, particularly in Asia, the company has seen demand for huge cruise ships or luxury mega-yachts dwindle.

The industry has been shaken by a spate of recent coronavirus outbreaks on liners despite increased health measures, giving new headaches to the pandemic-hit sector. - FMT