Finland’s largest shipbuilder Meyer Turku is getting an €80 million ($85 million) financial lifeline from the Finnish government to overcome liquidity challenges caused by the ongoing geopolitical situation caused by Russia’s war in Ukraine.
The European Commission approved the recapitalization measure on Monday, December 19, adding that the necessary safeguards to limit competition distortions would be maintained.
“The company contributes to the security of supply, national defence, and border control of Finland with its marine technology expertise and production capacity. In addition, Meyer Turku Oy is active in the global shipbuilding industry, holding 15% of the global cruise shipbuilding market. It has therefore great economic and social weight in both the Finnish and European economy,” the commission said.
The package is in line with the Temporary Crisis Framework , adopted on 23 March 2022, which enables EU member states to use the flexibility foreseen under state aid rules to support the economy in the context of Russia’s war against Ukraine. These have included support for companies affected by the sanctions and countersanctions as well as aid for high energy prices as well as measures aimed at the rollout of renewable energy.
The aid will take the form of a hybrid equity loan. The recapitalization aims at strengthening the solvency of the company and at ensuring the smooth continuation of its activities, which is essential from both an economic and social perspective in light of the interaction of Meyer Turku Oy’s operations with a sizeable value chain in the Finnish economy.
The company has just emerged from two very difficult years caused by the pandemic which resulted in extra costs. However, the company managed to avoid order cancellations.
The shipbuilder has been putting a major focus on the construction of LNG-powered cruise ships, with several ships set for delivery to meet the growing demand for cruises as the sector emerges from the doldrums caused by the COVID-19 pandemic.
At the beginning of December, the company launched Icon of the Seas, Royal Caribbean’s first ship that runs on liquefied natural gas and utilizes fuel cell technology. The vessel will also feature shore power connections and waste heat recovery systems.
The company has also built and delivered LNG-powered Mardi Gras and Carnival Celebration, among others, and most recently the yard has launched construction on TUI Cruises’ methanol-ready cruise ship. Meyer Turku Oy has also won a contract from the Finnish Border Guard to build two new multipurpose vessels.