ZAGREB, August 6, 2019 - Prime Minister Andrej Plenković on Tuesday visited the Rijeka-based 3.Maj shipyard and after he was informed by the dock's management about the current state of affairs and the future plans, the premier said that all what he heard during the talks was encouraging.

Plenković, accompanied by Economy Minister Darko Horvat, Transport Minister Oleg Butković and Justice Minister Dražen Bošnjaković, held the talks with the company's director Edi Kučan who informed them of plans to complete the three ships under construction, two of which are in the 3.Maj dock and one in the Viktor Lenac dock.

Plenković said that the management and workers had showed a high level of motivation to resume the production and complete the vessels as well as to embark on the second stage which will unblock company's account and facilitate efforts to find a strategic partner that will help 3.Maj to have a feasible business model governed by market rules.

"Our engagement is intended to help solve the urgent problems now, and in two years' time how long the completion of the ships will take, the survival of shipbuilding in 3.Maj should be enabled, with a strategic partner being found," Plenković said.

Plenković said that justice, finance and economy ministries and some other expert companies were tasked with seeking a legal framework for the implementation of the government's decision to get involved in the process of unfreezing the dock's accounts and assist in restarting production for the completion of ships already under construction at the dock.

The government's decision of 1 August made the Rijeka County Court adjourn the bankruptcy hearing.

During today's visit to Rijeka, Plenković said that 3.Maj, established in 1905, had a long tradition and was a matter of Rijeka's identity.

He said that he had been informed today that there were about 740 people on the 3.Maj payroll.

Director Kučan said that the shipyard planned to relaunch the production of a bulk cargo ship ordered by a Canadian company and a ship for transportation of trucks and cars.

Kučan said that the completion of the ships would bring about more to the dock than what was invested, and this could satisfy the European Commission's criteria

At the start of the 1 August cabinet meeting, Plenković recalled that the management of 3. Maj had sent a letter to the government at the end of July asking for state guarantees for its account to be unfrozen and for production to restart so ships that are under construction at the dock can be completed. He said that the dock had been restructured in late 2017 in accordance with the rules on restructuring enterprises facing hardships and that the company's account have been frozen for some time.

"Unlike the Uljanik shipyard, 3. Maj is not overindebted and had it not lent money to Uljanik, it would have operated normally because all current and potential buyers have expressed interest and readiness for their ships to be completed and there is interest for new ships to be built too," said Plenković at the cabinet meeting a few days ago.

More news about Croatian shipyards can be found in the Business section.

ZAGREB, August 6, 2019 - The leader of the Jadranski Sindikat trade union, Boris Cerovac, asked on Tuesday that Prime Minister Andrej Plenković, who was expected to visit the Rijeka-based 3. Maj shipyard with three government ministers during the day, apply the same rules to the ailing Uljanik dock as are those applied to other Croatian shipyards.

Addressing a news conference in Pula, Cerovac welcomed the government's decision to try to salvage 3. Maj but expressed dissatisfaction with the way the government had been treating the Pula-based Uljanik dock over the past year and a half.

Cerovac also criticised local politicians for not demanding a parliamentary debate on Uljanik.

"You should fight for the people who have elected you to your posts," he said.

Samir Hadžić, a member of Uljanik's board of creditors and a former member of its supervisory board, said that the prime minister's visit to 3. Maj was of a ceremonial nature and that the government's criteria as to whether a shipyard would be salvaged or not depended solely on political criteria - the voter base or other political interests.

"There is no economic or any other logic in that. Uljanik built 60% of ships in the last 30 years, and yet we have been abandoned as worthless. Still, we have an offer to build five cruise ships, there are two ships that should be completed, and a third one is in Rijeka," said Hadžić, confident that if the government acted and used the present possibilities, Uljanik would have a chance to restart production and continue Pula's shipbuilding tradition.

More news about Croatian shipbuilding can be found in the Business section.

ZAGREB, August 2, 2019 - A Coin Ceremony was held at the Brodosplit shipyard in Split on Friday with a coin being laid in the keel of a passenger ship for polar expeditions to be built at the dock for the US company Quark Expeditions.

"For the client the coin symbolically reflects a personal approach to polar expeditions," Brodosplit said, adding that this the first time a ceremony of this kind was held at the shipyard.

The ship which will be named Ultramarine. It will be 128 metres long, 21.5 metres wide and will weigh 13,500 gross tonnes. It will sail out in 2020 and will be able to carry 200 passengers.

Brodosplit underscored that this is a new business step for the dock onto the market for passenger ships up to 200 metres in length.

Quark Expeditions was founded in 1991 and is part of the UK-based TUI Travel PLC Group of Companies. In 2016, it became part of Travelopia, a division comprising some brands from the former TUI Specialist Group. It specialises in expeditions to the Arctic and Antarctic aboard purpose-built expedition vessels.

Brodosplit CEO Tomislav Debeljak told reporters that the client has expressed interest for the Split-based dock to construct more such ships and that the price of these cruise ships range from 100 million to 300 million euro.

"We don't build tankers; we have been saying that from day one. Instead we have opted for building cruise ships, primarily for polar expeditions, and we are the strongest in that in the world," Debeljak said.

He added that the "old structure" wanted to force Brodosplit to build tankers. "That is the structure that siphoned HRK 40 billion from Croatian citizens. We said, No, we are building 'positive ships.' That is harder but more positive for Croatia, for workers and for all of us," said Debeljak.

More news about Croatian shipbuilding industry can be found in the Business section.

ZAGREB, August 1, 2019 - The government decided at its meeting on Thursday to get involved in the process of unblocking the account of Rijeka's 3. Maj shipyard, relaunching production and completing the vessels on which work had begun.

The Croatian shipbuilding corporation Jadranbrod was instructed to thoroughly analyse the proposed measures and submit its findings to the Ministry of Economy, Entrepreneurship and Crafts. The ministry will then propose specific measures based on the laws on the budget, state grants and other regulations and will present them to the ministries of finance and justice.

After the harmonisation of the proposed measures, the authorities in charge are required to submit a proposal for the implementation of today's conclusions to the government by August 29.

The 3. Maj shipyard completed the process of restructuring in late 2017, but found itself in financial trouble as a member of the Uljanik Group.

"3. Maj, unlike Uljanik, is not overindebted, and had it not granted those loans to Uljanik it would have been operating normally because both the present and potential buyers have expressed an interest in completing the ships, and there is also an interest in building new ones," Prime Minister Andrej Plenković said.

He said he expected the 3. Maj shipyard to draw up a firm action plan to ensure its operation in the years to come.

More news about Croatia shipbuilding can be found in the Business section.

ZAGREB, July 26, 2019 - The Uljanik shipyard, which is undergoing bankruptcy, on Friday handed over a luxury passenger ship built for the PEC Ltd company from Malta, the Zagreb Stock Exchange said on its website on Friday.

The ship is 168 metres long, 21.5 metres wide and can take 237 passengers. It is intended for ocean sailing and has been built according to the latest ecological standards.

In March this year the FINA financial agency submitted a request to the Commercial Court for bankruptcy proceedings against the Uljanik shipyard joint-stock company because the shipyard had unsettled payments that were more than 120 days overdue, its debt then amounting to 28.2 million kuna.

The Uljanik Group comprises 11 companies in all and is the majority owner of the Rijeka-based 3. Maj shipyard.

More news about the company can be found in the Business section.

ZAGREB, July 24, 2019 - The president of the Supervisory Board of the Rijeka-based 3. Maj shipyard, Juraj Šoljić, on Wednesday sent a letter to Prime Minister Andrej Plenković, asking him that, based on everything that has been done in the dock in the past two months, he present his stance and make a decision on the fate of that shipyard.

"Our aim is to finish the ships we have started and to avoid bankruptcy because 3. Maj and Croatia will benefit the most if production continues. Hence, we ask that you urgently make a decision so that extra costs are not incurred," Šoljić wrote.

He underscored that with the efforts invested by the dock's director, Edi Kučan, with the help of the Economy Ministry and judiciary as well as the Jadranbrod - Hrvatska Brodogradnja company, a lot has been done to bail out the shipyard.

He noted that dock's liabilities were reduced from 156 million kuna to 76 million kuna. Detailed calculations have been made that would be required for ships to be completed and talks have been conducted with potential buyers.

He added that over the past two months the dock had contracted and completed other jobs too which ensured some liquidity and made it possible for wages to be partially paid.

We are prepared to immediately start with production

Šoljić underscored that a new bankruptcy hearing was scheduled for August 1. "Based on everything we have achieved in the shipyard over the past two months, please inform us of your stance. If you decide for the continuation of production, we are prepared to immediately start with production, particularly with regard to the construction of a ship for the transport of trucks and vehicles for which material exists but, considering that not one contract is valid, we cannot launch construction," he underlined.

Šoljić warned that as more time goes by, the more costs are incurred and that could result in certain creditors once again demanding distress orders which could then jeopardise deadlines and, in that case, prices offered to buyers would be completely different.

More news about Croatian shipbuilding can be found in the Business section.

ZAGREB, July 23, 2019 - The Commercial Court in the Istria County town of Pazin has set the value of an unfinished dredger the Pula-based Uljanik shipyard was building for the Belgian/Luxembourg group Jan De Nul at 1.059 billion kuna, and set the terms of sale.

The court ruled that at a first public electronic auction the vessel may not be sold for less than three-quarters of the value determined, or 794.2 million kuna. At a second auction it may not be sold for less than half its value, or 529.5 million kuna, and at a third auction for less than a quarter of its value, or 264.75 million kuna. In the event of a fourth auction, the starting price would be 1 kuna.

According to unofficial sources, an invitation to the first auction could be announced later this month and could be completed by late September, by which time it could be clear whether Jan De Nul would be the buyer and how much of the 920 million kuna guarantee the government would manage to recover.

More news about Croatian shipbuilding industry can be found in the Business section.

ZAGREB, July 4, 2019 - A hearing to determine whether conditions exist to launch bankruptcy proceedings for the Rijeka-based 3. Maj shipyard, scheduled for Thursday at Rijeka Commercial Court, was once again delayed, this time until August 1, as it was expected that more creditors would lift their blockade of the shipyard's account.

Judge Liljana Ugrin said that the situation in the shipyard was rapidly changing and that according to the Fina financial agency the dock's debt has risen to 96.6 million kuna, 29.7 million of which refers to workers' wages.

In the meantime, she has received information that one of the shipyard's creditors has withdrawn its enforcement order for 10 million kuna, as a result of which the shipyard's account was now blocked for 86 millionkuna , adding that there are indications that some other creditors may also withdraw their enforcement orders.

Citing data from Fina, the judge said that on June 28 the claims amounted to HRK 156 million, adding that the national electricity provider HEP was still demanding HRK 10.3 million, but noted that workers' wages were not part of the negotiations.

Ugrin said that 200,000 kuna had been deposited in the shipyard's account last week and this was immediately transferred for workers' wages.

The judge said that if she knew that wages would be paid immediately she would launch bankruptcy proceedings, underscoring that she was interested in solutions, that this was not just about the 800 employees at the dock and that she was interested in saving part of the city's industry.

The shipyard's director Edi Kučan said that it was important to regain the trust of creditors, that there were indications that other creditors too would withdraw their claims, and that the claims could eventually be reduced to about 1 million kuna.

More news about Croatian shipbuilding industry can be found in the Business section.

ZAGREB, June 27, 2019 - Minister of Economy, Entrepreneurship and Crafts Darko Horvat said on Thursday he believed that Rijeka's 3. Maj shipyard would not end up in bankruptcy and that the government intended to find a solution to help the shipyard complete the projects it had begun.

"We have to be sure that whatever we do is in line with law," Horvat told reporters after a cabinet meeting when asked if the government would provide financial assistance for the completion of the vessels.

Asked if he expected this might draw objections from the European Commission, Horvat said there would be no problems with the Commission. Asked if this meant that the shipyard would not end up in bankruptcy, given that a bankruptcy hearing was scheduled for July 4 before the Commercial Court in Rijeka, Horvat said he believed there would be no bankruptcy.

Asked last week if there was a chance of the government entering 3. Maj with its own money, Horvat said that a legal way was being sought to ensure the completion and delivery of the ships that were near completion.

On July 4, the Commercial Court in Rijeka is due to examine preconditions for the opening of bankruptcy proceedings for the 3. Maj shipyard. The hearing has been delayed several times so far, the last time being in early June.

More news about Croatian shipyards can be found in the Business section.

ZAGREB, June 14, 2019 - The Brodosplit dock on Friday confirmed for Hina that the completion and delivery of the sailing ship "the Flying Clipper", is running late compared to contracted deadlines adding however that the Split-based shipyard would not be held responsible as this was an approved delay and the ship will be completed.

A spokesman at the dock said that the Flying Clipper is the first sailing ship in the world to have 'Safe return to port' security standards installed and that it meets all the requirements of the US coast guard and its public health standards and it is the only sailing ship in the world that has been assigned with the highest category of noise and vibration.

"It has been extremely complicated to build that type of ship however Brodosplit will be completing it soon," Brodosplit said.

The Friday edition of the Novi List daily reported that the company Star Clippers from Monaco had in March terminated its contract with Brodosplit even though in May they said that they hoped an agreement with the Split dock would be reached to take over the ship.

Novi List further writes that it seems the situation finally "snapped" at the end of May, calling on sources from the ship's owner in Monaco and that the client has called for guarantees on advance payments of 15 million euro to be enforced and that they were allegedly paid this week.

According to unofficial information, the state has 12.7 million euro in active guarantees for the Flying Clipper while sources in the Finance Ministry earlier in the week denied the allegations by the Novi List about the activation of the guarantees.

More news about Croatian shipyards can be found in the Business section.