Germany provides bridge loan as the first rescue operation for MV Werften

The federal government has announced that it will grant the financially troubled MV Werften shipyards a bridging loan to resume operations and maintain employment until spring. MV Werften, part of the financially troubled Genting Hong Kong, ceased operations in March, citing the health restrictions that interrupted the flow of material to the shipyard.

As part of the agreement, MV Werften will receive a bridging loan of 193 million euros (228 million US dollars) from the German Federal Economic Stabilization Fund (WSF). The bridge financing is intended to cover ongoing operating costs as well as wages and salaries for employees at the shipyard sites.

“This is the result of intensive negotiations over the past few weeks between the representatives of Genting, the MV Werften Group and the federal government with the participation of the state of Mecklenburg-Western Pomerania,” said state finance minister Reinhard Meyer. The contract stipulates that all funds will be spent on the shipyard with a focus on the completion of an expedition cruise ship, the Crystal effortwhich should be delivered to Crystal Cruises in April 2020.

With the approval of the federal government for the bridging loan, the state authorities, with the approval of the cabinet and the finance committee of the state parliament, also release the remaining funds in a project account for Global I, the first of two 200,000 gross tons of cruise ships are also being built at the shipyard for Genting’s Dream Cruises. According to the state government, this will amount to around 43 million euros (50 million US dollars) to continue the construction of the giant cruise ship at the Wismar site in order to reach the next milestone in its construction by the end of the year.

All three MV Werften shipyards in Germany are expected to resume operations in October while negotiations on a long-term rescue package are ongoing. The German authorities estimate that a total of more than 500 million euros (590 million US dollars) will be required for the second rescue phase of MV Werften. They requested additional reports from independent auditors and determined that the plan would be related to the proposed restructuring of Genting Hong Kong. According to the state ministers, the aim is to obtain long-term funding from the WSF by the end of the year if possible.

“We will work intensively on this in the coming weeks,†said Mecklenburg-Western Pomerania’s Minister of Economic Affairs, Harry Glawe. “We have made a big step forward. The federal rescue fund has opened up for the MV shipyards. This is a first important milestone for the shipyard locations. “

MV Werften welcomed the support of the state of Mecklenburg-Western Pomerania and the federal government and assured that all funds from the loans in Germany will be used for the MV WERFTEN shipyards. In 2016, Genting Hong Kong acquired the shipyard from Neptune Shipyard to develop the current facility, which employs approximately 3,000 people in three main locations. So far, MV Werften has completed the construction of four river cruise ships for Crystal Cruises. Work on the Crystal Cruises expedition cruise ship and the two major cruise ships for Genting were in progress when work ceased.