Thursday, July 15, 1999 Published at 16:11 GMT 17:11 UK
Business: The Company File
Kvaerner Govan saved
Work will be transferred to the yard
Kvaerner has signed a deal to sell its Glasgow Govan shipyard to Marconi Electronic Systems after 24 hours of negotiations in London.
The two companies said they had signed a "heads-of-agreement" deal which will see the yard change hands for £2.25m.
Kvaerner said: "The signing ... means that the immediate threat of large-scale redundancies at the yard can now be lifted."
All current operating assets and liabilities will remain part of Kvaerner's account, as will responsibility for the completion of the two vessels now being built there.
Kvaerner will foot the bill if there are any redundancies at the yard in the 42 months after that date.
But the Norwegian firm's President, Kjell Almskog, said: "Marconi have assured us that their aim is to secure a long-term future for the yard."
"That's something that's already on the record. We have to make sure the workforce and the management are able to compete in a very competitive world."
The yard's GMB union convener Jamie Webster said: "It's absolutely fantastic. The atmosphere here is electric, people are over the moon.
"Now the party can start officially and I'm going to one right now.
Mr Almskog described the deal as a "balanced" solution and he said it reflected the interests of the workers, shareholders and the Govan community.
He said: "Uncertainty has surrounded the future of the Govan yard ever since we made a strategic decision earlier this year to make a complete exit from our global shipbuilding activities.
"The past few weeks have been extremely difficult for our workforce.
"We still have some way yet to go to make this deal really work - but all the parties are now determined to make that a reality."
The outline settlement was the sequel to a "handshake" general agreement reached late on Tuesday.
The two companies were brought together at the behest of Scottish Secretary Dr John Reid and Scottish Office Industry Minister Lord McDonald.
Dr Reid said: "A new future beckons for the Govan yard but the months ahead will not be easy."
First Minister Donald Dewar said: "This is but the first step and my officials will in the coming weeks be working very closely with the new owners of the Govan shipyard to ensure that in the longer term the workload at Govan is such that its future is secure."
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