Croatia moves to Boost Troubled Rijeka yard

Maritime Activity Reports, Inc.

August 1, 2019

The Croatian government said on Thursday it would help a troubled shipyard owned by Uljanik , the country's largest shipbuilder, resume production.

The government, which owns a 25% stake in Uljanik, said in March that it would not back a proposed restructuring plan for the group due to the financial burden it would place on the state.

However, Prime Minister Andrej Plenkovic said on Thursday that the government was willing to support 3.Maj, which is located in the northern Adriatic port of Rijeka and is one of the group's two shipyards, because it did not have as big a debt burden.

"Unlike Uljanik, the 3.Maj is not an overly indebted company and there is an interest in the construction of new ships," Plenkovic told a televised press conference after a government meeting.

He said the government expected 3.Maj to draft a plan for its future operations.

Dnevnik.hr portal reported Plenkovic as saying that the government would help unblock the shipyard's accounts and assist in preparations to restart production and complete earlier projects.

Uljanik has been battling to stave off bankruptcy due to liquidity problems that began in 2017. Its other shipyard, in the city of Pula, was placed into bankruptcy in May after an almost year-long effort to keep it afloat.

Also on Thursday, the commercial court in Rijeka postponed a bankruptcy hearing on 3.May until Sept. 26.

3.Maj completed a restructuring process in late 2017 but later found itself in financial trouble as a unit of the Uljanik group. 

(Reuters, Reporting by Daria Sito-Sucic; Editing by Susan Fenton)

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