After meeting with representatives of workers at the Uljanik and 3. Maj shipyards on Wednesday, Economy Minister Darko Horvat said that getting another strategic partner was possible for the restructuring of the Uljanik Group, and requested the European Commission to verify the model for the group's restructuring.
Horvat added that the restructuring model for the Uljanik docks was sent to Brussels earlier in the day, which should relieve the pressure by the European Commission which set July 22 as the deadline by which the plan must be submitted for verification. This also staved off the repayment of the loan Uljanik was given in January under the condition it submitted a model for its restructuring by that date.
The government in January issued a state guarantee in the amount of €96 million for a loan by the Uljanik shipyard for the implementation of its restructuring process, as well as the financial consolidation of the company.
On January 22 the European Commission cleared rescue aid for the shipyard, and said that the measure will “allow the company to meet urgent liquidity needs while preparing a restructuring plan, whilst competition distortions are limited.”
He assured workers and unionists at both shipyards that there was no need for fear as the model sent to the EC was not necessarily the final one, and that the final model would be agreed only after several rounds of negotiations. Only when it is certain that the model is acceptable to the EC, the actual restructuring model would be formally submitted, Horvat said.
Horvat added that he would request the EC to suggest what was not acceptable in the proposed model and that in the meantime efforts would be made to secure the docks’ liquidity.
He went on to say that it would be necessary to secure the survival of the group’s core business, but that there were no guarantees as to what would be happening in the next few years, after the strategic partner approved by the group’s general assembly earlier this year – the Koncar Group – takes over Uljanik.
In late March, Uljanik’s management and supervisory boards chose Kermas Energija owned by Croatian investor Danko Koncar and his Koncar Group as the strategic partner for the dock’s recapitalisation.
Horvat added that the government’s primary aim was for the shipbuilding group’s core business to survive.
The minister added that it is yet to be seen whether Koncar would enter into the restructuring phase under amended conditions.
Horvat said that a rough estimate existed of the funds required to finance the dock’s book of orders, and that the group was applying for a loan from the Croatian Bank for Reconstruction and Development (HBOR) to ensure liquidity.
He added that this is the last chance for the state to intervene in saving the shipbuilding industry, which accounts for a significant share of Croatia’s exports.
“Shipbuilding, as the last remnant of industry in Croatia, is in the government’s strategic interest, but 3. Maj and Uljanik can no longer operate on orders that generate losses but rather on orders that will keep them afloat,” Horvat said.
Asked whether there was any danger of state guarantees being activated, Horvat said that he believed that that would not be necessary and that everything was being done to meet obligations towards suppliers and clients. He added that there were two projects that were nearing completion and that could secure working capital.
Union representative Djino Sverko said that they were encouraged with what they heard at today’s meeting with the minister regarding the restructuring process and that it was everyone’s priority for the Rijeka-based 3. Maj and the Pula-based Uljanik to save their shipbuilding business.
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