A shipbuilder which has two Scottish yards has announced the business is set to move into administration.
Belfast firm Harland and Wolff said between 50-60 immediate redundancies are expected but said that staff employed at its four shipyards are not affected.
The company, which famously built the Titanic, has four shipyards.
The two Scottish sites are based at Methil, on the Firth of Forth, and Arnish, on the Isle of Lewis. It also has one in Belfast and one in England (Appledore in north Devon).
This is the second time the business has been placed in administration in five years.
The administration process will be confined to the holding company, Harland & Wolff Group Holdings PLC, and the operational companies which run the yards are expected to continue trading.
A company statement said: “A full review of all group holdings commenced in July and has concluded that H&W Group Holdings PLC is insolvent on a balance sheet basis as per its last audited accounts and most recent management accounts.”
Insolvency practitioners Teneo will act as administrators and shares will be delisted.
The company is part of a consortium that landed a major contract to build new fleet solid support ships for the Royal Navy.
It had applied for a £200 million loan guarantee from the Government as part of efforts to restructure its finances.
But the Government decided in August not to act as a guarantor on the lending – while also ruling out direct funding to maintain the company’s liquidity.
Harland and Wolff interim executive chairman Russell Downs said the group had faced a “very challenging time” due to historic losses and a failure to secure long-term financing.
He said: “It’s important to recognise that this is very difficult news for staff and will affect many within group.
“We will work to support our staff through this transition.
“We also know that it will be very unwelcome news for shareholders who have shown significant commitment to the business over the last five years.
“The board, the senior managers and rest of the team are committed to deliver the best outcome for the four yards and communities they serve to ensure their continued operation into the long term under new ownership.
“Unfortunately, extremely difficult decisions have had to be taken to preserve the future of our yards.
“Despite the recent challenges, the four yards have a strong capability, under new ownership and with the continuing support of their customers, to deliver UK-based ship building and leading UK-based renewables employing over 1,300 committed personnel.
“It’s critical that the business comes through its financial troubles to secure an enduring legacy worthy of its name and its past for the benefit of the UK as a whole and its communities in particular.”
Scottish Liberal Democrat MSP Willie Rennie said: “This is a hammer blow for workers and communities who have been put through the ringer in recent years.
“Ministers have flocked to the Scottish sites whenever the opportunity for a photo has arisen. Now, the Scottish Government must be working closely with Harland and Wolff to establish what exactly this announcement means for the workers at the Methil and Arnish yards.
“If we are to fully exploit the opportunity of the renewables growth, we need to have the sites at Methil and Arnish fully utilised.”
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