Norwegians Terminate Shipbuilding Contract as Uljanik Cannot Obtain Guarantees

The Norwegian client has unilaterally terminated the contract with Uljanik for the construction of a cable-laying vessel due to the inability of the Pula shipyard to obtain bank and performance guarantees in accordance with the contract, Uljanik reported on Friday via the Zagreb Stock Exchange.

This concerns a cable-laying vessel for which Uljanik signed a contract with the Norwegian company Nexans Subsea Operations in August last year. It was announced at that time that the delivery deadline for this vessel was 34 months from the contract’s entry into force.

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According to data from last year’s announcement regarding the signing of the contract, the total length of the vessel was to be 149.9 meters, with a width of 31 meters, and it was to have a large installed power with a dynamic positioning system and a turntable for cable storage with a capacity of 10,000 tons.

“Due to Uljanik’s inability to obtain bank and performance guarantees in accordance with the provisions of the shipbuilding contract concluded with Nexans Subsea Operations AS from Norway for one cable-laying vessel, the buyer has unilaterally terminated the shipbuilding contract, and the contract is no longer binding for the contracting parties,” Uljanik stated.

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As unofficially learned, the Management of Uljanik discussed today with representatives of all unions operating in the Pula shipyard and the Workers’ Council of Uljanik shipyard, who are familiar with the latest developments regarding the restructuring program, as well as the role of the state and strategic partner in that process.

The Minister of Economy, Entrepreneurship and Crafts, Darko Horvat, stated yesterday that the restructuring plan for Uljanik was sent to the European Commission on time and that a response from the Commission regarding the analysis of the restructuring program is awaited.

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Additionally, it was announced earlier this week that a potential strategic partner, Kermas Energy, assisted Pula with a loan of 12.4 million euros to overcome financing issues for the newbuilding 500, specifically a suction dredger for a Dutch client.

>>>Kermas Loaned Uljanik 12.4 Million Euros to Repay Bank Debt So They Could Continue Operations

With this loan, Kermas Energy, a company owned by entrepreneur Danko Končar, helped Uljanik repay its bank debt to ensure the normal operation of the shipyard and prevent the activation of state guarantees, confirmed Uljanik and Kermas Energy on Wednesday.

Namely, Uljanik had to repay the loan to the bank to ensure that the newbuilding 500, which is a self-propelled suction dredger contracted by Uljanik with the Luxembourg company Dredging and Maritime Management S.A. as part of the JDN Group, could be delivered without issues.

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This loan enabled normal financing of newbuilding 500 until the delivery date, in such a way that the buyer finances the construction with its own funds, Uljanik reported at that time.