A ‘truly defining’ £1.6 billion Ministry of Defence contract given to shipbuilder Harland & Wolff Group Holdings PLC (AIM:HARL) is reportedly on the verge of collapse due to uncertainty surrounding the future of the company.
If confirmed, it would be an embarrassing turn for H&W, which operates the iconic Belfast shipyard where the Titanic was built.
The company was placed into administration in 2019 but its fortunes were lifted at the tail end of 2022, when it emerged as a preferred bidder for a £1.6 billion Ministry of Defence contract.
The firm was to manufacture three vessels providing munitions, stores and provisions to the Royal Navy’s aircraft carriers, destroyers and frigates.
John Wood, chief executive of Harland & Wolff, called it “a truly defining moment” at the time.
But according to The Telegraph, the government is considering rescinding the contract, leaving the door open for rival bidders. BAE Systems, Babcock and A&P Group are reportedly considering taking on the project.
The disappointing news comes hot off the heels of a report from The Times suggesting Harland & Wolff’s £200 million government funding round was rejected.
Wood denied the report, telling the BBC: "Our application has not been rejected and continues to be a work in progress. I expect to be providing a fuller update on our refinancing plans in the next few weeks."
Proactive has reached out to Harland & Wolff for a comment.
AIM-listed Harland & Wolff shares fell 10% on Friday.