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FINANCIAL PROBLEMS FOR FLENSBURGER YARD

Wednesday, January 30, 2019 

According to German media reports, the Flensburger Schiffbau-Gesellschaft (FSG) yard is currently in financial crisis. The finance ministry and the ministry of economic affairs have been aware of the situation for some time now, and are working to secure the financing of current projects.

The reports say that invoices are going unpaid, and contractors' workers have been withdrawing from the yard. The 650 employees were told at a staff meeting on 25 January that their salaries for January will be paid, but the situation seems unsure about whether this can continue in February.

The Ministry of Economic Affairs says that the state government, shipyard and shipowners are in close agreement about the serious position, and are in talks about possible guarantees. "It's about many jobs in Schleswig-Holstein," said Minister Bernd Buchholz.

The yard, founded in 1872, has previously experienced financial problems. In 2014, when orders for two newbuildings were cancelled and the banks refused more credit, FSG was saved then through being bought by Siem, and the yard moved from general cargo ships into specialising in ro-pax ferries. One of these vessels, the WB Yeats, was eventually delivered to Irish Ferries in December 2018, several months behind schedule. This resulted in cash flow problems - yards are not normally paid until the ship is delivered - and penalties. FSG's position looks as if current projects, including the LNG-fuelled Honfleur (pictured at launch) for Brittany Ferries, due for handover in summer 2019, will suffer delays and incur further penalties.

A statement issued by FSG CEO Rüdiger Fuchs said: "The delays of the new building 771 (WB Yeats) caused considerable losses at the FSG. The FSG has developed a plan to finance the shipyard, to which we are currently engaged in intensive discussions with the state of Schleswig-Holstein, customers and suppliers as well as the works council and (trade union) IG Metall."

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