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German court rules against loan payment to Genting Hong Kong

A German court ruled Mecklenburg-Vorpommern state doesn't have to pay Genting Hong Kong a backstop loan of €78m.

Frederik Erdmann, German Correspondent

January 17, 2022

1 Min Read
Credit: Seatrade Cruise News

Genting HK, which took the state to court, has warned it may not be able to meet financial obligations without those funds. Already last week both Genting-owned MV Werften and Lloyd Werft Bremerhaven filed for insolvency.  

Shortfall had not been expected until around 2024

Genting HK had demanded payment based on an agreement signed last June as part of its $2.6bn restructuring. In this agreement, Mecklenburg-Vorpommern was to provide the loan in case of financial distress. At the time, it was expected a liquidity gap could arise around 2024, yet Genting already in December said the money was needed, citing the pandemic's continued impact on business.

Schwerin District Court did not agree Genting is in a distress situation without the loan.

Entitled to appeal

The cruise operator is entitled to appeal today's decision. Genting HK hasn't issued a statement yet. 

About the Author

Frederik Erdmann

German Correspondent

Frederik Erdmann is Seatrade's German cruise correspondent since 2002. Following secondary school graduation he joined the port agency network, Sartori & Berger, on a vocational training program. After subsequent studies of Business Administration, Frederik Erdmann held various positions at Sartori & Berger until 2010. After a period of working with the Flensburg Chamber of Commerce, he was appointed Designated Person Safety/Security, Environment and Quality of the coastal ferry operator, Wyker Dampfschiffs-Reederei. As a maritime trade press correspondent and visiting lecturer of the Flensburg University of Applied Sciences,

Frederik Erdmann concentrates on ferry and cruise ship management, port development as well as safety and security in passenger shipping. He is also a member of the Flensburg Chamber of Commerce's Tourism Committee.

 

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