Royal IHC is set to receive a refinancing package worth €400 million (US$437 million) from the Dutch government plus a roughly equivalent amount from local and foreign companies.
The refinancing is intended to ensure the continued operations of the Dutch shipbuilder, which had been incurring mounting debt and significant losses on custom-built ships. In particular, the company had posted a loss of €80.6 million (US$88.23 million) despite a revenue of €942 million (US$1.03 billion) in 2018.
As part of the refinancing deal, Royal IHC will be taken over by a consortium formed by local firms MerweOord and Huisman, Luxembourg-based HAL Trust, and Ackermans and Van Haaren of Belgium. This comes after a heads of agreement (akin to a letter of intent) was reached by the consortium and the company's existing international syndicate of banks.
The heads of agreement is made possible by a short-term bridging loan and guarantee facility from the Dutch Ministry of Economic Affairs and Climate Policy, and an export credit insurance contribution from the country's Ministry of Finance.
Royal IHC said that, in the coming period, the heads of agreement will be fine-tuned. The agreement itself is subject to final agreement between the parties involved, and the usual assessments, including from regulators.