Even more state aid for troubled Croatian yard

Croatia's government said it will provide more state guarantees to troubled shipyard 3. Maj for a 26 million euro loan, which will help the complete a ship ordered by Canadian shipping company Algoma. Croatia’s finance ministry will issue the guarantees for the loan that will be extended by Croatian state-owned development bank HBOR and other commercial banks to finance the construction of the self-unloading bulk carrier with the yard number 733 for Algoma Central Corporation, the government said in a statement. In order to obtain the guarantees, 3. Maj's management and supervisory boards have to agree that 3. May repays 50 million kuna (6.8 million euro) to HBOR to settle earlier liabilities. Earlier in September, HBOR approved a 150 million kuna (20.2 million euro) government-guaranteed loan to 3. Maj to help it restart production and complete vessels already under construction. As a result, 3. Maj in mid September started paying the overdue salaries to its employees from the first tranche of the HBOR loan. Earlier in September, 3. Maj had signed a deal to revive the shipbuilding contract with Algoma, which the buyer cancelled last year after 3. Maj failed to meet its contractual obligations. 3. Maj is part of troubled shipbuilding group Uljanik, which includes another major shipyard in Croatia, Uljanik Shipyard. The Croatian government has said it is willing to help 3. Maj but the Uljanik Group is too large to be saved.