German Government Intervenes to Support Meyer Werft

The German government plans to temporarily take a majority stake in Meyer Werft, a leading cruise ship builder, as part of a support measure. Chancellor Olaf Scholz, along with Lower Saxony officials, will communicate this at a staff meeting. The company needs 2.8 billion euros to finance luxury liner construction.

The German government plans to take a temporary majority stake in Meyer Werft, one of the world's top cruise ship builders, as part of measures to support the company, sources familiar with the matter told Reuters on Thursday. Chancellor Olaf Scholz and members of the state government in Lower Saxony are expected to convey this message at a meeting with staff later Thursday, the sources said.

The company has orders in the pipeline, including from U.S. entertainment group Disney, but needs to raise almost 2.8 billion euros ($3.12 billion) in order to help finance the construction of its luxury liners. Scholz's government, the state and the family owners of the company have agreed in principle and set out the key points of the arrangement, according to the sources.

The federal and state governments want to contribute 400 million euros in equity, secure bank loans with guarantees and temporarily take over at least 80% of the shipyard, they said. The federal government did not comment specifically on the matter and spoke only of ongoing talks. A spokesman for the economy ministry of Lower Saxony declined to comment.

($1 = 0.8976 euros)

(With inputs from agencies.)