Babcock International, the London-listed defence contractor, is weighing a possible bid for some of the assets of Harland and Wolff, the shipbuilder which is close to collapse.
Sky News has learnt that Babcock, which has a market value of £2.4bn, has expressed an interest in Harland and Wolff’s Belfast shipyard which is famous for having built The Titanic.
News of its interest comes amid reports that Harland and Wolff could fall into administration as soon as next week.
The company has been struggling under the weight of a substantial debt-pile, and was dealt a hammer blow soon after the general election when the government decided against guaranteeing a £200m loan to it.
It was unclear this weekend how serious or advanced Babcock’s interest was in Harland and Wolff’s Belfast shipyard or its other assets.
Several other trade and financial bidders are understood to have signalled their interest in bidding, according to defence industry sources.
Bankers at Rothschild, who are running a sale process to gauge interest in the company and its assets, have set a deadline for proposals of later this month.
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Navantia, the Spanish shipbuilder which has a joint contract with Harland and Wolff, is likely to be among the rival bidders.
Teneo is reported to have been put on standby to act as administrators.
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Image: Pic: PA
Founded 163 years ago, Harland and Wolff operates from three sites other than Belfast: one at Appledore in south-west England, which used to be owned by Babcock; and two in Scotland.
In recent weeks it has been engulfed by management turmoil, with the departure of its chief executive and, this week, its finance chief.
On Friday, Russell Downs, the company’s interim executive chairman, said he had ordered a probe into what he described as an apparent “misapplication” of more than £25m of corporate funds.
Its shares, which are listed on London’s junior AIM stock market, have been suspended for months, and will be delisted if the holding company collapses into insolvency proceedings.
The parent company’s administration will not mean that its operating facilities are insolvent, as they are held in separate corporate entities.
However, there are concerns that such a move would prompt the Ministry of Defence to re-tender a contract that Harland and Wolff has a share in to build three Fleet Solid Support ships for the Royal Navy.
Image: A worker at Harland and Wolff MIG welds an anode onto the rudder. Pic: PA
John Wood, the former chief executive who was forced to step down recently, told The Sunday Times that he was preparing a rescue bid for Harland and Wolff.
He indicated to the newspaper that he could seek an injunction to prevent its holding company being placed into administration.
Babcock has been deeply embedded in Royal Navy shipbuilding contracts for decades, and would be a logical acquirer of Harland and Wolff assets.
Image: Workers at the Harland and Wolff shipyard. Pic: PA
The FTSE-250 group has largely recovered from its own travails of several years ago, announcing last November that it would pay its first dividend for four years.
Shares in Babcock have risen by over 20% during the last year.
Babcock said that it did not comment on speculation.
UK car production fell by more than a quarter (27.1%) last month as a cyberattack at Jaguar Land Rover halted manufacturing at the plant, industry figures show.
The total number of vehicles coming off assembly lines – including cars and vans – fell an even sharper 35.9%, according to September data from the Society of Motor Manufacturers and Traders (SMMT).
“Largely responsible” for the drop was the five-week pause in production at Jaguar Land Rover (JLR) due to a malicious cyber attack, as other car makers reported growth.
JLR’s assembly lines in the West Midlands and Halewood on Merseyside were paused from late August to early October as a result.
During this time, not a single vehicle was made. Production has since restarted, but the attack is believed to have been the “most financially damaging” in UK history at an estimated cost of £1.9bn, according to the security body the Cyber Monitoring Centre.
It was the lowest number of cars made in any September in the UK since 1952, including during the COVID-19 lockdown.
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3:53
Are we in a cyber attack ‘epidemic’?
Despite the restart, the sector remains “under immense pressure”, the SMMT’s chief executive Mike Hawes said.
The phased restart of operations led to a small boost in manufacturing output this month, according to a closely watched survey.
Of the cars that were made, nearly half (47.8%) were battery electric, plug-in hybrid or hybrid.
The vast majority, 76% of the total vehicles output, were made for export.
The top destinations are the European Union, US, Turkey, Japan and South Korea.
JLR was just the latest business to be the subject of a cyberattack.
Harrods, the Co-Op, and Marks and Spencer, are among the companies that have struggled in the past year with such attacks.
Championship club Sheffield Wednesday have filed for administration, according to a court filing, which will result in the already struggling side being hit with a 12-point deduction.
The South Yorkshire club currently sit bottom of the Championship, the second tier of English football, with just six points from 11 games.
Known as The Owls, Wednesday are one of the oldest surviving clubs in world football, with more than 150 years of history.
Court records confirm the club have filed for administration. A notice was filed at a specialist court at 10.01am.
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2:58
Sky’s Rob Harris reports on the news that Sheffield Wednesday have filed for administration
What has happened?
The Owls, who host Oxford United on Saturday, have been in turmoil for a long time.
On 3 June, owner Dejphon Chansiri, a Thai canned fish magnate who took over the club in 2015, was charged with breaching EFL regulations regarding payment obligations.
Image: Sheffield Wednesday fans protest the ownership at a game away to Leeds United in January. Pic: Reuters
Weeks later, Mr Chansiri said he was willing to sell the club in a statement on their official website.
Image: Sheffield Wednesday’s troubles have sparked furious protests from fans. Pic: PA
Their crisis deepened just days later when another embargo was imposed on the club relating to payments owed to HMRC, before players and staff were not paid on time on 30 June.
In the months that followed, forwards Josh Windass and Michael Smith left the club by mutual consent. Manager Danny Rohl, now at Rangers, also left by mutual consent.
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2:12
Frustrated Sheffield Wednesday supporters have targeted their embattled club’s owner in a highly-visible protest during their opening match of the season.
The Owls were forced to close the 9,255-capacity North Stand at Hillsborough after a Prohibition Notice was issued by Sheffield City Council.
‘Current uncertainty’
On 6 August, the EFL released a statement, saying: “We are clear that the current owner needs either to fund the club to meet its obligations or make good on his commitment to sell to a well-funded party, for fair market value – ending the current uncertainty and impasse.”
On 13 August, the Prohibition Notice was lifted, but a month later, news emerged of a winding-up petition over £1m owed to HMRC.
Last season, Wednesday finished 12th. They had already been placed under registration embargoes in the last two seasons after being hit by a six-point deduction during the 2020/21 campaign, for breaching profit and sustainability rules.
With a 12-point deduction, the Owls would be 15 points away from safety in the Championship.
Doing well were computer and telecommunications retailers as the iPhone 17 launched in the month, while online jewellers reported strong demand for gold despite the price hovering around record highs.
Gold has been in demand, and in recent days reached a record high, as some investors moved money out of the US dollar and government bonds amid the ongoing government shutdown.
It came despite a rainy month – which typically keeps shoppers at home – and a five-day tube strike in London.
The impact of the rain could be seen, however, in the boost to online spending, which rose to one of the highest levels since the end of the pandemic.
A fall was recorded in food shop sales from August to September, signalling a response to high food price inflation.
A good week for the economy?
Retail sales figures are significant as they measure household consumption, the largest expenditure in the UK economy.
Growing retail sales can mean economic growth, which the government has repeatedly said is its top priority.
Earlier this week, another key economic measure came in better than expected.
Inflation remained at 3.8% rather than rising to the widely expected 4% – double the target rate set by the interest rate-setters at the Bank of England.
Consumers were feeling better about their finances, a closely watched measure of consumer confidence showed on Friday.
Buying sentiment is up from last month, according to market research company GFK, as intentions to buy big-ticket items like electrical goods and furniture rose.
Combined, it suggests people are not feeling too gloomy in the run-up to the November budget.