The Scottish Government has taken the Ferguson Marine shipyard, which collapsed due to soaring costs of a contract with a state-owned ferry company, into public control.
The Government said last week that the takeover of the Ferguson Marine shipyard would enable completion of the two LNG-fuelled ferries being built there for Caledonian Maritime Assets Ltd (CMAL).
It will also ensure work continues towards the delivery of the other vessels currently under construction and secure a future for the yard through continuity of employment for the workforce.
This follows two years of extensive discussions with partners to try and find a workable commercial solution.
Economy Secretary Derek Mackay met with the newly-appointed turnaround director who was named to take further steps to stabilize the business and recruit an incoming management team, including a new CEO.
The Scottish government, which loaned Ferguson Marine £45 million to keep the yard going, appointed marine engineer Tim Hair as the turnaround director.
Mackay said: “We have always been clear that we want to complete the vessels, secure jobs, and give the yard a future.
“Public control will provide much-needed continuity of employment now and ensure the completion of the CMAL ferry contracts at the lowest possible cost to the taxpayer. The alternative was for the government to stand aside while the company went into administration, resulting in the jobs being lost and the vessels not being completed.”
GMB Scotland Organiser and CSEU Scotland Chair, Gary Cook, said: “Nationalization secures the immediate future of the yard, and that is a very welcome development, particularly after all the recent uncertainty.”
Before the takeover, the yard was far from the hopeful state the yard was in 2014 when self-made billionaire Jim McColl rescued the yard from collapse. Now, the tycoon stands to lose tens of millions of pounds on the deal for the construction of the ferries.
The ferries will be dual-fuel vessels so they can operate on LNG and diesel. They are designed to carry 127 cars or 16 HGVs, or a combination of both and up to 1,000 passengers.
The first ferry was expected to enter service in early 2018. The second was supposed to follow a few months later. Neither happened, and the first, the MV Glen Sannox, was launched in November 2017 and, at the time, the delivery was pushed back to winter 2018/19 which also did not occur.
The routes that the two vessels will serve when completed will be Ardrossan to Brodick and Uig to Tarbert and Lochmaddy.
It is worth reminding that Ferguson Marine won the £97 million ($117.5M at current rates) contract for the two ferries back in 2015.
According to the BBC, the bill for the vessel construction is now understood to be nearly double the original £97 million contract price.