Quebec’s struggling Davie Industries shipyard sold to Norway’s Teco

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This article was published 13/10/2006 (7240 days ago), so information in it may no longer be current.

QUEBEC (CP) – Teco Management of Norway announced Friday it will go ahead with its purchase of Quebec’s struggling Davie Industries shipyard.

The Norwegian company announced in June its intention to purchase the bankrupt shipyard but trustees announced in August it would be liquidated after Teco failed to meet the conditions for the purchase.

Teco was given the opportunity to negotiate the required financial guarantees and trustee Thibault Van Houtte and Associates Ltd. said Friday they have now done so.

The bankrupt shipyard will cost the company $28.4 million.

The government of Quebec has guaranteed 50 per cent of a $15.5 million loan to the company for the purchase and the city of Levis, where the shipyard is located across the St. Lawrence River from Quebec City, is providing tax credits in excess of $1 million over five years.

Trustee Patrice Van Houtte said at a news conference that his company approached hundreds of potential buyers around the world.

“We have spared no effort in finding a buyer capable of assuring the survival of the shipyard and the preservation of jobs,” Van Houtte said.

“Mission accomplished.”

Richard Gauvin, president of the shipyard union, said it was a great day for workers and their families.

“It’s also a great day for Quebec, where the maritime industry has been saved,” he said.

Yet Premier Jean Charest appeared to be in the dark about the deal.

An hour before the announcement, which included one of his own deputies, Charest said there was “no announcement to make.”

“We’re actively working on that file,” he told reporters. “When the negotiations have concluded, if they conclude successfully, Economic Development Minister Raymond Bachand will make an announcement for the government.”

The shipyard has been in bankruptcy since 2001. It is believed to be among the oldest shipyards in Canada.

Friday’s deal puts an end to years of uncertainty.

Workers held out hope that the facility would be sold and granted a number of concessions during the last 10 years to keep it alive. A new collective agreement is already in place.

The shipyard near Quebec City employed more than 3,000 in the early’90s but that number has dwindled, and now fluctuates somewhere under 1,000. Its future has been uncertain since Dominion Bridge put it into bankruptcy in 2001.

The shipyard was founded in’25 by George Taylor and Allison Davie. It was later owned by Canada Steamship Lines (1920-1968), Power Corp. (1968-1976), Soconav (1976-1981), Dome and Versatile (1981-1987), and MIL-Davie (1987-1996) before going into the hands of Dominion Bridge.

The shipyard built oil tankers, cargo ships, trawlers, ferries, warships and oil drilling stations.