Genting Hong Kong's unfinished Global Dream cruise ship attracts investors

The ship was about 72 per cent complete when the German government and Genting could not agree on plans to finance the shipyard that was building it. PHOTO: AFP

BERLIN (BLOOMBERG) - Billionaire Lim Kok Thay is among several investors interested in purchasing the Global Dream mega luxury liner that was under construction at Genting Hong Kong's now-insolvent shipbuilder, MV Werften in Germany.

Several serious interested parties are in talks to buy the unfinished ship, said Mr Christoph Morgen, the German court-appointed provisional insolvency administrator for the shipbuilder.

Mr Morgen is optimistic a deal could come together, but thinks it likely will not happen before next month because the case is complex, he said at a briefing at the shuttered shipyard in Wismar on Monday (Feb 14).

MV Werften's provisional insolvency in early January proved to be a turning point for Genting Hong Kong, which became the world's biggest cruise operator to seek court assistance to safeguard its assets during the coronavirus pandemic when it filed a wind-up petition days later. Genting reported a record loss of US$1.7 billion (S$2.29 billion) in May as the pandemic ravaged the cruising industry.

Mr Lim, who resigned as Genting Hong Kong's chairman and chief executive last month, contacted Mr Morgen to express interest in purchasing the ship at the beginning of the provisional insolvency process, Mr Morgen said. The insolvency administrator said he hopes to find "a better solution for the ship" than Mr Lim.

"My impression is that he would only like to buy it if nobody else would be interested in order to get it cheap and possibly to finish the ship somewhere else," said Mr Morgen, who added he has nor heard from Mr Lim since. "I hope that we won't depend on this, because we now have strong interest from many other possible investors."

The 342m liner was set to be the world's biggest vessel by passenger capacity. It was to usher in a new era of mega ships tapping Asia's growing cruising market.

The ship was about 72 per cent complete when the German government and Genting could not agree in December last year on plans to finance US$620 million to help finish it and keep the shipyard in business, according to a letter Mr Lim wrote to creditors.

A spokesman for Genting Bhd, which Mr Lim heads as CEO, declined to comment. Representatives for Genting Hong Kong did not immediately respond to a request for comment. Mr Lim still holds about 75 per cent of shares in Genting Hong Kong and heads other Genting businesses, although there are no cross shareholdings.

Mr Henning Groskreutz, a union leader from the local IG Metall chapter, said that the shipyard will still need between €500 million (S$762 million) and €600 million to finish the ship.

"We will need this money in order to be able to convince the workers to stay here," Mr Groskreutz said. Many workers have already left and have started at other employers because there is high demand for such skills.

Mr Habeck said the government would be willing to subsidise the final construction of the Global Dream with a "new reliable investor".

"If there's a reliable finance plan, we could make the same offer like over Christmas," Mr Habeck said, adding that Genting did nor want to contribute financially to complete the ship. "We don't want to throw money out of the window."

Genting's Crystal Cruises brand shut its United States office and terminated employees last week. The closing of Crystal Cruises' operation in Miami came after two of its ships were seized in the Bahamas after a fuel supplier sought the action for US$4.6 million in unpaid fuel bills.

Dream Cruises Holding, an indirect non-wholly owned unit of Genting Hong Kong that has also filed a winding up petition, will continue to operate its fleet in Asia, the company said.

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