Storied Belfast shipbuilder Harland & Wolff Group Holdings PLC (AIM:HARL) is teetering on collapse as Labour prepares to reject a £200 million government loan request.
According to a Financial Times report, Labour will refuse to act as guarantor to the critical funding, with one Whitehall figure calling it a “deeply irresponsible” use of the public purse.
The company is seeking a £200 million facility from UK Export Finance to keep the business afloat.
Earlier this month, the group warned that its “ability to execute new and large contracts would be adversely affected” should it fail to secure the lifeline.
Debt-laden Harland & Wolff’s financial woes deepened in May when a £1.6 billion contract with the Ministry of Defence fell through.
The contract was previously dubbed a “truly defining” moment for the 163-year-old Belfast shipyard.
Late last year, Harland & Wolff’s bid for a Scilly ferry contract was rejected.
Harland & Wolff failed to publish its audited annual report on the 1 July due date, causing its AIM-listed shares to be suspended from trading.
The suspension remains in effect as of July 17.