The Star has reported that Canadian Shipbuilding & Engineering Ltd. (CSE) will seek government money, cut labour costs and restructure before resorting to a sales process if necessary, the monitor overseeing its bankruptcy protection said in court documents.
CSE was formed 20 years ago by the merger of the shipbuilding and repair divisions of two of Canada's biggest private shipping companies, Canada Steamship Lines and what is now called Upper Lakes Group Inc.
The CSL Group — owned by former Prime Minister Paul Martin until 2003 — sold its remaining interest in Canadian Shipbuilding & Engineering in November.
Upper Lakes Group Inc. now owns more than two-thirds of CSE, which had 420 employees when all its operations were running.
Peter Cairns, president of the Shipbuilding Association of Canada, said CSE illustrates the struggles of a Canadian industry that is competing with low wages and government subsidies abroad.
CSE sought bankruptcy protection earlier this month and is asking an Ontario judge to extend it until Oct. 13.
It suspended operations at its shipbuilding and repair facility, known as Port Weller Dry
Docks, in St. Catharines. CSE also has a division called Canal Marine in St. Catharines and a plant in Thunder Bay.
In recent weeks, CSE — which has a history of receiving government funding — has been seeking financing from the federal and Ontario governments, and has been in discussions with Export Development Canada, which is likely to be the shipbuilder's biggest creditor in its restructuring.
Management estimated that CSE would need new funding of about $16 million to finish the rest of the ships.
Source: The Star