Navantia has taken control of Harland and Wolff and at an event held in Belfast today, attended by senior leadership from Spain, promised further investment in skills and facilities.
H&W Group went into administration in October 2024 as it could no longer support its debt burden. When the project to revive the company began in 2019 borrowing costs were much lower with no one forecasting a sudden spike. Interest rates rose to 14% whilst steel prices jumped 50%, creating huge pressure on the company. The Tory government jointly agreed an official statement to the market in December 2023 approving a UKEF guarantee for a £200m loan at a competitive rate. This guarantee was subsequently turned down by the new Labour administration resulting in the company seeking a buyer.
Riverstone Credit Opportunities Income (RCOI), who held the company’s debt announced they had sold the business and assets of H&W Group to Navantia UK on Monday for £69.9 million. In addition, Navantia UK agreed to waive the £23 million lent to H&W to keep it going since October 2024. The deal provides job security for the workforce that have become Navantia UK employees under their existing terms and conditions. There are concerns the deal does not cover outstanding debts to companies in H&W’s supply chain and shareholders in the original enterprise have not been compensated.
Following the recent acquisition, senior leadership from Navantia and its British subsidiary, Navantia UK, visited Belfast and the team will tour all four sites – Belfast, Appledore, Methil and Arnish – over the coming days. Navantia’s Chairman, Ricardo Domínguez spoke to the Belfast workforce, telling them they plan to expand the investment and recapitalisation plan for Harland & Wolff, which is central to the FSS programme but had been paused in recent months.
Navantia, fully owned by the Spanish state, brings proven expertise and will continue the process of technology transfer, which will be required to update the UK facilities to be competitive for both defence and commercial opportunities. From the RN’s perspective, with Navatia fully underwriting the project, delivery of the 3 Fleet Solid Support (FSS) ships looks much more secure.
The long-term effects on the UK shipbuilding industry have yet to be determined, possibly a ‘cuckoo’ is in now the nest that may eventually be able to out-compete domestically-owned entities. An alternative view is that the Spanish have saved a yard that is badly needed to provide the capacity for the RN to realise its future ambitions, especially for the construction of larger vessels such as the Multi-Role Support Ships.
Competition is generally good.
Look how Babcock made BAE get out its best pencil sharpener?
Forcing productivity with modern plate lines and indoor build etc has definitely upped the frigate/destroyer game.
Let’s see what happens.
My main interest is in seeing RN get the ships it desperately needs and the funding to retain trained people as well as sort the RFA situation out.
All
This is really great news – both for RN and especially for the H&W workforce in Belfast.
This news is the best possible outcome from what has been, over the past year, a very nasty, messy and often very complicated situation
However, a word to the wise for the H&W workforce….
………when I was talking to Navantia’s MD back in sept 2023, a specifically chating about H&W and what might possibly happen next – he made it very very clear that the Belfast workforce would need to stop living in the past (and especially the heritage of the Titanic)
= so H&W now needs to, quickly, adopt those modern Spainish working practices.
Peter (Irate Taxpayer)
PS And so, lads, it is Paella on the menu in the H&W canteen from next Monday morning!
As the last ship built in Befast was MV Anvil Point, for MoD in 2003
Hardly living in the past of 110 yrs ago
More to do with their working practices
Yeah the media always likes to mention that existing staff have been kept on existing terms and conditions. I have no idea what those conditions are but they could well be getting paid a small fortune to do 3 hours work per day.
They will be in for a big shock if they are expected to match the productivity of Spanish yards.
And Rioja?
Less than £100m for the who company, work force and yards? Shoulda just nationalised it.
Not sure the deal includes the freehold on the sight in Belfast. I believe it’s on a long term lease.
fvf
So who do you want running this yard:
Nationalisation would definitely have been the wrong solution.
The simple truth of the matter is that what really matters here (i.e. with this announcement) is that Navantia’s top management team are now deeply involved in making a sucess of both the H&W yard and also the FSS contract .
It is that Spanish shipbuilding expertise that H&W so urgently needs injecting into it.
Peter (Irate Taxpayer)
Nail. Head. Hit.
I really hope it is a great success for Navantia, RN and the workforce.
Just like I hope RFA recruitment becomes a runaway success….wait I see a pink flying pig out the window….otherwise I’m mystified how we will crew these three, the tankers, Bays, Argus and all the other non RFA tasks the RFA have been given.
In better news Andrew Bailey has been clearly stating that defence spending is no longer optional….a powerful voice of reason….
Supportive Bloke
You are right about RFA’s, and indeed RN’s, recruitment and retention “challenges”.
Those issues are now very serious..
However, across both services, I believe that pay is only one part of the whole “crewing problem”.
Over the past few years I have gained the very distinct impression that a very big part of these RFA/RN crewing issues is being directly caused by our old and increasingly very unreliable ships
That unreliability and unpredictability thus causes the constant changing of the Navy’s plans – and thus changes the dates for deployments
Therefore many crews are – very frequently – now being very seriously messed about = especially when their sea duties are being dramatically extended at very short (often none!) notice.
That always causeschaos with the matelot’s own long-made plans (i.e. family reunions and key event; the reorganisation of expensive and already-paid-for holidays etc etc)
Thus having a more modern and thus more reliable RN /RFA fleet will almost ceratinly help mitigate these crewing issues (although it will not solve them entirely…)
Peter (Irate Taxpayer)
N-a-B
Nice to have you back in action on NL
Peter (Irate Taxpayer)
It definitely does not include the freehold on the land. The terms of the lease will be very generous though. I don’t even think H&W owned the Cranes with the famous letters on them. There would be uproar if they where painted grey with Navantia on them.
We wouldn’t wanna pay the upkeep cost and would probably sell it after FSSS
A workforce depresses the value of any company via TUPE.
As the buyer has obligations to the workforce but the workforce can still just walk. So the best ones tend to walk so you are never sure what you are left with.
I learned that the hard way buying one company….
TUPE does create a liability based on the length of service of the workforce but if you are looking for a going concern that may have been adversely impacted but outside factors (or just some poor management decisions) as explained in the article then that you can take on a skilled workers who know the business is a bonus.
Of course there are those just looking to asset strip of course and they don’t want or need people.
The challenge for any Administrator is the uncertainty the process brings to workers, suppliers and customers. The procedures are covered by strict confidentiality and whilst this is understandable in some respects makes it hard to provide reassurance to all interested parties.
Quite often the upheaval all this creates is life changing for some involved who find it incredibly difficult to adjust to the circumstances.
A horrible situation for honest, hard working people particularly those who have committed a large part of their working lives to a business and have emotional ties to their colleagues.
It is a life changing amount of stress to buy a company out of administration – I know: I’ve done it!
Total mess to clear up.
TUPE can mean that some companies are not salvageable as the potential risks of redundancy outweigh the upside. It is a very hard thing to confront as bidders don’t necessarily have mountains of cash to burn.
Needs a roof.
That’s neither practical nor nessecary.
Babcock and BAE seem ok with it. But yes you are probably correct.
Meyer Truku can build the worlds largest cruise ships outside in pretty awful conditions over winter I’m sure it won’t be a problem in Belfast.
I didn’t say it was a problem, Ships have been built there and virtually everywhere else for thousands of years, you missed the gentle nod to the fact BAE and Babcock have gone down the route of bloody big build sheds. Appledore build their ships undercover and our Submarines are also built undercover and I’m sure the added protection is welcomed by all who build them.
Appledore then take the ships out and let them sit in mud with tidal changes along their fit out wall, so I’m not sure using them as an example is ideal.
Reason I mentioned practicality is simply the size of the dry dock, also the fact that they’re going to utilise Sampson and Goliath when constructing a ship this size as they’ll be handling massive blocks of ship
Yes I know it’s not practical for those and other reasons but hell, it would be a marvellous addition.
Apparently Navantia have only guaranteed to keep the other yards going for three years.
Didn’t know that.