Thursday, September 20, 2000

Harland and Wolff to trim 600 jobs
Harland and Wolff has now issued details of its restructuring plans. It includes an immediate down-sizing to a core workforce of approximately 600 employees. This will necessitatie shedding some 600 personnel. It has been confirmed that assistance will be forthcoming, through the Department of Higher and Further Education, Training and Employment for Northern Ireland to facilitate payment of employees statutory redundancy entitlement. It is anticipated that the redundancy process will be concluded by October 5.

Commenting on the restructuring, CEO Brynjulv Mugaas said : "The extent of the redundancy which needs to be implemented is highly regrettable and deeply painful. However, in order to provide the maximum opportunity for Harland and Wolff to restore market confidence and secure its future in shipbuilding and offshore construction, we need to match employment levels closely to confirmed workload.

"A leaner, more responsive and more productive shipbuilding and offshore construction business will be better placed to take advantage of emerging market opportunities and to counter the cyclical nature of ship ordering patterns. Critical to this will be the necessity for an immediate and fundamental step change in productivity in order to enhance the competitiveness of the company. We would hope to keep the redundancy implemented to around the level identified, but this will depend on achieving the major improvement in productivity coupled with the securing of major orders. This is the only way to ensure the company's future."

It is anticipated that the precise details of the restructuring will be finalized next week.

Newbuilding returns to Tyneside
Britain's Cammell Laird (Tyneside) will hold a keel laying ceremony for the RO/RO ferry Leka, Friday. Leka is the first new shipbuilding contract for the yard and represents a major milestone in returning new building to the River Tyne for the first time in nine years.

Leka is the first of two roll on/roll off shuttle ferries for the Norwegian domestic market ordered by Torghatten Trafikkselskap. They were won against significant stiff competition. Cammell Laird has carried out all the design work on both vessels jointly between its Oslo and Tyneside offices.

The 55 m long x 14 m beam Leka will be delivered in February 2001,

The second vessel, yet to be named, will be 70 metres long x 14.7 metres breadth and is due for delivery in August 2001. Immediately after the keel laying ceremony for the "Leka", Edmund Skjelsvik, Chairman of Torghatten Trafikkselskap will formally commence production on the second vessel by initiating a computer controlled steel plate profiling machine.

Kvaerner still wants to work something out with Aker Maritime
Commenting on the Aker Maritime board's rejection of its take-over offer, the Board of Kvaerner ASA, says it "welcomes Aker Maritime's agreement on the strong industrial rationale for combining the two companies." But it chides Aker Maritime for making "no constructive proposals towards the achievement of this goal" and says that "attempts by Kvaerner to engage in a constructive dialogue with Aker Maritime have been rebuffed."

It also says the Aker Maritime statement "provides no justification for the rejection of the offer or a basis for valuing the company at a level above that offered by Kvaerner."

The Kvaerner board notes that Aker Maritime is "internally discussing structural solutions for a combination other than the Kvaerner offer," motivated by Aker Maritime's 26.4 per cent shareholding in Kvaerner.

Kvaerner says that "a better way forward is for Aker Maritime to engage in a dialogue. Without a mutually acceptable solution, this will leave the companies with an ownership situation between two competing companies that has the potential of creating conflict in the market place to the disadvantage of both companies, their shareholders and employees. "

The Kvaerner Board has decided to extend the acceptance period for its offer until close of business on Friday, September 29 , the date of the Extraordinary General Meeting. "This will provide an opportunity for a further exchange of information in an attempt to resolve the unsustainable situation that has been created and to act in the best interest of both companies."

The Kvaerner Board is maintaining its recommendation to shareholders to alter the mandatory bid threshold for Kvaerner from 40 to 30 per cent by changing the company's articles of association. Kvaerner is encouraging all shareholders to attend the Extraordinary General Meeting 29 September or submit their proxies.

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