Two Non-Executive Directors of Harland & Wolff have resigned with “immediate effect” as the company continues to seek additional funding.
On Tuesday, the company has announced that Malcolm Groat, Sir Jonathon Band and Katya Zotova, have resigned from the board with immediate effect.
Russell Downs, Interim Executive Chairman, commented: “On behalf of the Board, I wish to thank our outgoing Non-Executive Directors for the time and hard work that they have put in over the years in support of the Company and wish them well in their future endeavours.”
It comes after Harland & Wolff suspended work on its 2023 accounts.
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BBC NI has also reported that a group of Harland & Wolff shareholders fear the business is being lined up for a “pre-pack” administration.
That would see the company enter administration and its trading assets would immediately be sold to a pre-determined buyer.
Meanwhile, the ship builder also confirmed the appointments of two new board members as “it seeks to complete a recapitalisation intended to give the company a sustainable financial footing.”
The company said in a statement on Monday that it was unable “to finalise its 2023 accounts on a going concern basis.”
This means that the company is not confident that, if it submitted its accounts currently, it would be presented as able to stay in business for the foreseeable future.
Harland & Wolff has been experiencing financial problems in recent months. It had an application for a government guarantee of a new £200m loan turned down.
The UK Government said there was a “very substantial risk” that taxpayer money would be lost on such a guarantee”.
The company is part of a consortium that has been contracted by the government to build new Fleet Solid Support (FSS) Ships for the Royal Navy.
The company say that delivering this project remains a priority and that it has “built significant scale and capability in its yard” in recent years to fulfil this and another programme.
They further said that they remain in “active discussions” on the FSS programme, and are continuing work on its “existing order book”.
The statement on Monday confirmed that its recently announced a £19m loan increase from existing creditors Riverstone is providing “short-term liquidity” for the company.
It added that the company “remains reliant” on Riverstone’s support.
In recent days a group of shareholders have expressed concerns that the company is being run in the interests of the company’s creditors as opposed to those who hold equity.
A spokesperson for the group said that shareholders have not been consulted about changes at the company.
H&W has not responded to requests for comment.
Rothschild & Co, which has been appointed as a financial adviser for the company, is continuing to “assess strategic options” for Harland & Wolff.
The company said that its resources are being focused on the “Rothschild process” while the work to publish their accounts for 2023 is suspended.
The firm announced the formal appointments of Russell Downs and Alan Fort to the board of directors. Mr Downs has joined as interim executive chairman, and Mr Fort has joined as a non-executive director.
Mr Downs has a background in restructuring and refinancing and worked for 30 years at PwC. He said: “We remain focused on working with interested parties and key stakeholders to ensure that we can navigate through this uncertainty preserving the underlying value in the yards and the FSS contract for its employees and other stakeholders.”
Mr Fort is a qualified chartered accountant who also worked for PwC, and is described as having experience at, “providing support and challenge to management teams to ensure that goals are clearly defined and performance is transparently monitored”.