MALTA—Malta’s government aims to shed more than half of the work force at the national shipyard in the next month as it seeks buyers for the facility, Finance Minister Tonio Fenech said.

The government, which will invite formal expressions of interest from buyers for Malta shipyards on August 11, is offering voluntary incentives to quit to its 1,700 workers, Fenech said in a telephone interview over the weekend in the island’s capital, Valletta.

“Unless a buyer is found for the yards, the company may be declared bankrupt and shut down,” Fenech said. “It is critically important for the future of the shipyards that these schemes successfully reduce the number of workers to less than 700.”

The government spent €825 million on the yard, wrote down debt and cut the work force by more than a third since the early 1990s as it diversified into ship conversion and yacht refitting and repair. Malta, which joined the European Union in 2004 and adopted the euro this year, must stop subsidizing it by the end of the year to meet the terms of its accession.

Workers have until the end of September to volunteer to quit, costing the government up to €49 million in compensation. The job-cut target follows a study of Mediterranean shipyards of a similar size, including the Catania shipyards in Sicily that have 550 staff, Fenech said.

“During the shortlist process we will start considering whether to sell the shipyards as a single business or as separate parts,” Fenech said. “We are keeping our options open.”

Fourteen companies from countries including the US and Norway have already made enquiries since the sale plans were first announced a month ago, Fenech said. The number of employees proved a hurdle in previous sale discussions.

”There was a strong need for the total revitalization of the yards, including revising the number of people working there and the overall skills base,” Henrik Fleischer, chief executive officer of Oslo-based Fleischer & Co., said in an interview when asked about his involvement in previous negotiations. “We will definitely be looking at the call for expressions of interest.”

Malta’s first docks were built by the Knights of St. John during their reign from 1530 to 1798. Under British rule, from 1800 to 1964, they were used as a military ship-repair yard and were most recently nationalized in 1997. (Bloomberg)

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Malta sheds more than half of shipyard jobs as it seeks buyers for facility, says minister

MALTA—Malta’s government aims to shed more than half of the work force at the national shipyard in the next month as it seeks buyers for the facility, Finance Minister Tonio Fenech said.