More state moves to rescue Croatian shipyard

The Croatian government said it has agreed to postpone the repayment of its claims against the troubled 3. Maj yard to help the company restart shipbuilding operations. 3. Maj also said it has agreed a deal with a customer to re-start work on a shipbuilding project. The repayment agreement is part of a government initiative to provide state guarantees on a 150 million kuna (US$22.5 million) loan to 3. Maj to help it restart production and complete vessels already under construction (New Ships 36/2019). The loan will be provided by the state-owned Croatian Bank for Reconstruction and Development (HBOR) under the condition that the yard reaches an agreement with all major creditors to postpone until September 1, 2021 the repayment of their claims for unpaid debt. The Croatian government is one of the main creditors of 3. Maj. Croatian transport minister Mr Oleg Butkovic has signed an agreement about a debt repayment plan, under which the yard will repay only 15 percent of its outstanding debt to the state budget within 30 days after withdrawing the HBOR loan, the government said. The repayment of the remaining 85% will be additionally decided on by August 31, 2021, at the latest, the government said. 3. Maj's overdue debt to the government, arising from unpaid concession fees, stood at 5.86 million kuna as of August 30, 2019, including 420,000 kuna interest. Meanwhile, 3. Maj said it has signed a deal to revive a shipbuilding contract for a self-unloading bulk carrier with Canadian shipping company Algoma Central Corporation. Algoma had cancelled the contract last year after 3. Maj failed to meet its contractual obligations. Croatian economy minister Darko Horvat as said the order is worth US$36 million. 3. Maj is part of troubled shipbuilding group Uljanik, which includes another major shipyard in Croatia, Uljanik Shipyard, along with smaller subsidiaries. The government said Uljanik is too big to be rescued but it is attempting to help 3. Maj.