Vard says customer has gone into administration

SINGAPORE - Mainboard-listed shipbuilder Vard Holdings said on Monday (May 9) that it has been notified that Harkand Group has entered into administration.

Harkand has one diving support and construction vessel under construction at Vard, originally contracted in December 2013 for delivery in the second quarter of this year.

The vessel is in an advanced stage of construction, said Vard, which did not give the dollar value of the contract.

The company said it is "currently evaluating its position towards Harkand. If the shipbuilding contract is unlawfully terminated by the customer, Vard will contractually be entitled to retain the advance payments already received, equivalent to 20 per cent of the original contract price, and to resell thevessel.

"The payments already received could facilitate a resale of the vessel."

Going into administration means an insolvent company is taken under the management of a court appointed administrator who will see if the firm can be rescued as a going concern.