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FSG ENTERS ADMINISTRATION - AGAIN

Tuesday, April 28, 2020 

Troubled German shipbuilder Flensburger Schiffbau-Gesellschaft (FSG) is said by German media to have filed for self-administered insolvency at the local court in Flensburg.

The administration process is seen as a way of starting work afresh for FSG, and has been seen in a positive light by workers' representatives. The yard had moved from its core production of standardised ro-ro freight vessels in order to diversify into the ro-pax segment. However, its first ro-pax, Irish Ferries' WB Yeats, was delivered late, incurring large penalties and losses. The yard continued with ro-ro ships for former owner Siem, the eighth of which was handed over in March, shortly after the yard ceased operations due to the Covid-19 crisis. An order for two ro-pax ferries for TT Line of Tasmania was cancelled earlier this year, by mutual consent.

FSG currently has two vessels on its order book. The LNG-fuelled Honfleur for Brittany Ferries was due to be delivered in 2019, but is still not completed. Before this latest announcement, the new delivery date was forecast to be Spring 2021. A second ro-pax for Irish Ferries is not thought to have been started yet, although the owner is said to have paid a substantial deposit. This was originally scheduled for 2020 hand over.

A new MD has been appointed, Martin Hammer, previously of P+S Werften. At a workers' meeting, FSG announced that the yard's future was likely to be a return to freight ro-ro construction, and current owner Tennor Holding is prepared to invest in a restructured FSG. The insolvency process under German law requires an administrator to be brought in from outside the company, though the current management can remain in control, this being a different process from bankruptcy. How this will affect the current ships on order has not been made clear.

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