Harland & Wolff Group Holdings PLC UKEF EDG Facility Update and Board Changes

RNS Number : 1025X

Harland & Wolff Group Holdings PLC

19 July 2024

 

This announcement contains inside information

19 July 2024

 

Harland & Wolff Group Holdings plc

("Harland & Wolff" or the "Company")

UK Export Finance EDG Facility Update and Board Changes

Harland & Wolff Group Holdings plc (AIM: HARL), the UK quoted company focused on strategic infrastructure projects and physical asset lifecycle management, provides the following update in relation to the Company's £200 million Export Development Guarantee ("EDG") application.

The Department for Business and Trade ("DBT") has notified the Company that HM Government will not be proceeding with the Company's application for the EDG facility at this time. The Company has therefore expedited discussions with Riverstone Credit Management LLC ("Riverstone") in order to secure alternative new debt facilities to support the near-term working capital needs of the business following its recent significant revenue growth. These alternative financing arrangements are expected to close within the next few days.

 

Concurrent with Riverstone's financing, the Company remains in active dialogue with key stakeholders, including the UK Government, around existing and future contracts and the long-term capitalization plan for the business. As part of this longer-term planning, the Company is engaging Rothschild & Co to assess strategic options for the Group.

 

Additionally, the Company announces the following proposed Board changes:

 

·      John Wood will be taking a leave of absence from his role as CEO with immediate effect.

·      Subject to completion of requisite client on-boarding procedures and due diligence, Russell Downs is proposed to join the board as Interim Executive Chairman. Russell is a highly experienced finance professional after a 30-year career in a traditional big four accountancy practice helping businesses and stakeholders across a wide spectrum of industries.  With notable successes returning significant value to stakeholders and securing complex refinancings, he is well placed to lead the Board at this time as it seeks to complete a recapitalisation intended to give the Company a sustainable financial footing into the medium and long term.

·      Subject to completion of requisite client on-boarding procedures and due diligence, Alan Fort is proposed to join the board as a Non-Executive Director. Alan has a long track record in performance improvement, with many years of board level experience ensuring good governance and providing support and challenge to management teams to ensure that goals are clearly defined and performance is transparently monitored. Amongst other roles, Alan is currently a Non-Executive Director at the steelmaker Celsa UK.

 

Other board members will remain in place, including Arun Raman as CFO and Malcom Groat as a non-executive director.  These board changes are not expected to have any material impact on the day-to-day operations of the Group.

 

The Company will make further announcements as soon as practicable detailing its new identified priorities and other relevant matters including an update on its financial reporting and lifting of the suspension of its shares.

 

Russell Downs commented:

 

"I am very pleased to take on this role after a challenging period for the Group as it transitions from one leadership team to another and deals with the increasing speculation over its future. The great weight of responsibility for all stakeholders involved in the business to secure a long-term future is crystal clear to me and I am enormously honoured to be given the responsibility to find a solution. I will be working tirelessly in consultation with employees, management, customers, suppliers, unions, government agencies and other stakeholder groups in the coming weeks."

 

For further information, please visit  www.harland-wolff.com  or contact:

 

Harland & Wolff Group Holdings plc Malcolm Groat, Chairman Arun Raman, Chief Finance Officer	[phone] [e-mail]   [e-mail]
h2Radnor (Investor Relations) Neville Harris / Josh Cryer	[phone]
Cavendish Capital Markets Limited (Nominated Adviser & Broker) Stephen Keys / Callum Davidson / Dan Hodkinson (Corporate Finance) Michael Johnson (Sales)	[phone]
Liberum Capital Limited (Joint Broker) Nicholas How / Edward Mansfield	[phone]

About Harland & Wolff

 

Harland & Wolff is a multisite fabrication company, operating in the maritime and offshore industry through five markets: commercial, cruise and ferry, defence, energy and renewables and six services: technical services, fabrication and construction, decommissioning, repair and maintenance, in-service support and conversion.

 

Its Belfast yard is one of Europe's largest heavy engineering facilities, with deep water access, two of Europe's largest drydocks, ample quayside and vast fabrication halls. As a result of the acquisition of Harland & Wolff (Appledore) in August 2020, the company has been able to capitalise on opportunities at both ends of the ship-repair and shipbuilding markets where there will be significant demand.

 

In February 2021, the company acquired the assets of two Scottish-based yards along the east and west coasts. Now known as Harland & Wolff (Methil) and Harland & Wolff (Arnish), these facilities will focus on fabrication work within the renewables, energy and defence sectors.

 

In addition to Harland & Wolff, it owns the Islandmagee gas storage project, which is expected to provide 25% of the UK's natural gas storage capacity and to benefit the Northern Irish economy as a whole when completed.

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