Stay of execution for Vulkan

IMRE KARACS

Bonn

Germany's largest shipbuilders, Bremer Vulkan, won a stay of execution yesterday when creditors agreed to put up enough money to keep the company afloat for at least two months.

Jobst Wellensiek, the administrator appointed after the company filed for protection from creditors last week, met representatives of 40 banks in Bremen and persuaded them that parting with another DM100m was the only way of protecting their investment. But that is not going to be enough to save at least parts of Vulkan from bankruptcy. Some 23,000 jobs would be lost if the whole company were liquidated.

The company has about DM7bn worth of orders, but needs some DM2.5bn to stay in business. As the scale of its mismanagement in recent years becomes apparent, the prospects of receiving a large cash injection from the taxpayer are growing dimmer.

Gunter Rexrodt, the Economics Minister, met Vulkan's management, only to repeat the message he has been sending from Bonn in the past week.

"To put it clearly: We can send no money to Bremen," Mr Rexrodt had told a newspaper at the weekend, and that was the line he stuck to yesterday.

The government argues that, rather than holding out its hand, Vulkan's management should be returning money it has received from the state.

Accusations from the European Commission that the company stole EU subsidies destined for its shipyards in eastern Germany were amplified by the east German privatisation agency BVS. The BVS estimates Vulkan owes its eastern shipyards DM716m, the bulk of it structural funds from the EU. It is unlikely that sum, poured into Vulkan's other loss-making divisions, will ever be recovered. "The money is gone," commented Mr Wellensiek.

But the EU's Competition Commissioner, Karel Van Miert, has threatened to veto a refinancing package unless the EU funds are recovered. Mr Van Miert is also unhappy about Vulkan's accounting which he thinks was designed to hoodwink the creditors.

In an interview with the magazine Der Spiegel, he revealed that a preliminary audit of Vulkan's accounts exceeded his worst expectations. "I don't know any details yet. But from what I hear the findings are even more disastrous than we had feared," he said.

Start your day with The Independent, sign up for daily news emails
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Adviser - OTE £24,500

£22500 - £24500 per annum: Recruitment Genius: Inbound and outbound calls with...

Recruitment Genius: Business Development Executive / Sales - OTE £40,000

£18000 - £40000 per annum: Recruitment Genius: This fast growing Insurance Bro...

Guru Careers: Research Associate / Asset Management Research Analyst

£40 - 45k (DOE) + Benefits: Guru Careers: A Research Associate / Research Anal...

Ashdown Group: Chief Technology Officer (CTO) - Glasgow

£90000 - £98000 per annum + benefits : Ashdown Group: A truly exciting opportu...

Day In a Page

Solved after 200 years: the mysterious deaths of 3,000 soldiers from Napoleon's army

Solved after 200 years

The mysterious deaths of 3,000 soldiers from Napoleon's army
Every regional power has betrayed the Kurds so Turkish bombing is no surprise

Robert Fisk on the Turkey conflict

Every regional power has betrayed the Kurds so Turkish bombing is no surprise
Investigation into wreck of unidentified submarine found off the coast of Sweden

Sunken sub

Investigation underway into wreck of an unidentified submarine found off the coast of Sweden
Instagram and Facebook have 'totally changed' the way people buy clothes

Age of the selfie

Instagram and Facebook have 'totally changed' the way people buy clothes
Not so square: How BBC's Bloomsbury saga is sexing up the period drama

Not so square

How Virginia Woolf saga is sexing up the BBC period drama
Rio Olympics 2016: The seven teenagers still carrying a torch for our Games hopes

Still carrying the torch

The seven teenagers given our Olympic hopes
The West likes to think that 'civilisation' will defeat Isis, but history suggests otherwise

The West likes to think that 'civilisation' will defeat Isis...

...but history suggests otherwise
The bald truth: How one author's thinning hair made him a Wayne Rooney sympathiser

The bald truth

How thinning hair made me a Wayne Rooney sympathiser
Froome wins second Tour de France after triumphant ride into Paris with Team Sky

Tour de France 2015

Froome rides into Paris to win historic second Tour
Fifteen years ago, Concorde crashed, and a dream died. Today, the desire to travel faster than the speed of sound is growing once again

A new beginning for supersonic flight?

Concorde's successors are in the works 15 years on from the Paris crash
I would never quit Labour, says Liz Kendall

I would never quit party, says Liz Kendall

Latest on the Labour leadership contest
Froome seals second Tour de France victory

Never mind Pinot, it’s bubbly for Froome

Second Tour de France victory all but sealed
Oh really? How the 'lowest form of wit' makes people brighter and more creative

The uses of sarcasm

'Lowest form of wit' actually makes people brighter and more creative
A magazine editor with no vanity, and lots of flair

No vanity, but lots of flair

A tribute to the magazine editor Ingrid Sischy
Foraging: How the British rediscovered their taste for chasing after wild food

In praise of foraging

How the British rediscovered their taste for wild food