Belfast Telegraph

Harland & Wolff for sale as Norwegian owner Fred Olsen instigates restructuring process

Takeover deal for world-famous manufacturer would represent one of the biggest NI corporate transactions in recent years

The famous Samson and Goliath cranes at Harland & Wolff in Belfast
The famous Samson and Goliath cranes at Harland & Wolff in Belfast
Economist John Simpson
H&W chief executive Jonathan Guest
Margaret Canning

By Margaret Canning

Harland & Wolff is up for sale as its Norwegian parent company Fred Olsen carries out a major restructuring.

The former shipbuilder behind the Titanic has diversified into renewable energy installations since the last ship sailed out of its famous yard in 2003.

The decline of shipbuilding has also been marked by a steady fall in employee numbers from as many as 30,000 in the 1930s to around 100 today.

A sale would mark one of the biggest corporate transactions in Northern Ireland in recent years after three decades in the ownership of Fred Olsen.

Harland &Wolff covers two sites on Queen's Island in east Belfast, including the Belfast Repair Dock where some ship work is still carried out.

There is also the main building dock and manufacturing halls where the famous Samson and Goliath gantry cranes operate.

The combined surface area of the sites is nearly 90 acres.

The building dock is the biggest in Europe, and one possible use is for the construction of next generation very large vessels in excess of 500,000 tonnes.

Yesterday a spokesman said: "Harland & Wolff Heavy Industries Ltd can confirm that as part of wider restructuring activities, it is engaged in a marketing process that may lead to a potential sale of the business.

"The day to day running of the company is unaffected."

Earlier this year Harland & Wolff's dry dock was used for the refitting of luxury cruise liner the Azamara Pursuit by staff of Newry marine fit-out company MJM.

It was the first deal of its kind involving a cruise ship being taken to the territory of a fit-out company, instead of staff of a fit-out company travelling to work on a ship in a distant location.

Speaking at the time of its arrival in Belfast, Harland & Wolff chief executive Jonathan Guest said the deal was "a great boon for the economy".

"It's the first time a large-scale refit has been carried out in Northern Ireland and I think that's hugely significant.

"Harland & Wolff has a great history of cruise ships and cruise ship building, but not so much in the refit side.

"So we hope this is a new chapter in the development of Harland & Wolff along with MJM in bringing cruise ship refits to Belfast and seeing where that can take us."

According to industry magazine ReNews, market experts regard Harland & Wolff as a potential bridge into the UK offshore wind market and that it would be of interest to both international investors and established fabricators.

But despite winning some major deals in recent years, the company in Belfast has reported financial struggles.

During 2016 it saw turnover drop from £66.7m to just £8.3m.

As a result Harland & Wolff Heavy Industries turned the previous year's £1m profit into an almost £6m loss.

The company said "in recognition of the very difficult trading conditions" the firm "further reduced its core employment in the second quarter of 2016".

It now has 115 staff, down from 170 at the end of the previous year.

"The directors consider the results for the year to be unacceptable but reflective of the very difficult market conditions in 2016," the firm's strategic report said.

Economist John Simpson said it was no surprise that Fred Olsen was considering a sale of Harland & Wolff.

He said that, taken as a whole, it would make a valuable asset for sale.

And he suggested that the company's present management could consider a purchase themselves "if they can raise the capital".

"As part of any due diligence process, a buyer will be looking at their latest accounts, which you would hope would be better than last year's," he added.

However, the company would not comment on whether present management could mount a buyout.

Belfast Telegraph

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