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February 9, 2004

Lloyd Werft declares insolvency

Lloydwerft Bremerhaven has declared insolvency under provisions of the German Insolvency Law (Insolvenzordnung) that became effective Han. 1, 1999.

The law requires a company to decalre insolvency if it is either over-indebted or illiquid. In contrast to former German law, the 1999 law provides for only once insolvency procedure or to the liquidation of an insolvent enterprise.

In this case, it seems clear that Lloyd Werft hopes the insolvency situation will be a temporary one. According to local press reports, the yard attributes its situation to the accident involving NCL's Pride of America, which partially sank during storms on January 14.

Reportedly, the accident meant that the yard did not receive a payment expected in January from NCL.

Wolfgang van Betteray has been appointed insolvency administrator. He's famed a as a rescue ace and legal whiz. His firm Metzeler-van Betteray, has managed more than 600 rescues in the past 10 years. Ironically, he first came to national attention in the 1996 restructuring of Bremen/Bremerhaven shipbuilding and ship repair and the emergence of Lloyd Werft as a separate entity. His work then led to his being given a medal by the City of Bremerhaven.

Meantime, latest word is that NCL plans to go ahead with completion of Pride of America, saying that the vessel is heavily insured to cover the damage sustained in the January 14 incident.

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