Malaysian billionaire Lim Kok Thay blames Germany for Genting Hong Kong’s demise

Lim said it would’ve survived had the new German government ‘honoured their obligations’ on US$620m in credit to help MV Werften continue building a cruise ship

German government officials have said that they did everything in their power to save MV Werften

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German cruise shipbuilder MV Werften has filed for insolvency, as the firm and its parent company Genting Hong Kong struggle with financial woes. Photo: dpa

Published: 10:06am, 29 Jan 2022

Lim Kok Thay, the former chairman of Genting Hong Kong Ltd, which slid into provisional liquidation last week, has accused the German government of walking away from a promise to provide capital to Genting’s shipbuilding unit, whose demise ultimately forced the cruise ship operator to seek court assistance to safeguard its assets.

As part of a restructuring deal last year, Germany’s former administration agreed to provide a US$620 million credit line to help MV Werften continue building a cruise ship called Global Dream, Malaysian tycoon Lim said in a letter dated January 24 and viewed by Bloomberg News.

But when the new German government took office in December, an alternative arrangement that Lim described as “unreasonable” was proposed and a personal guarantee was sought.

Lim Kok Thay, the Malaysian chairman of Genting Group. Photo: Bloomberg

The new German government also didn’t allow Genting Hong Kong to access crucial cash deposits after Lim injected US$30 million as a prerequisite. The lack of funds ultimately forced the company to seek provisional liquidation, Lim said in the letter.

“We were put in this position as a direct result of counterparties not honouring their contractual commitments that many of you negotiated tirelessly to achieve as part of the June 2021 restructuring,” Lim and the company’s former deputy chief executive officer, Colin Au, wrote.

In a statement on Friday, German government officials reiterated that they did everything in their power to save MV Werften.

Economy Minister Robert Habeck earlier this month blamed Genting itself for the shipbuilder’s failure, saying the state had offered a loan of 600 million euros (US$670 million) on the condition that Genting provide an additional 60 million euros plus guarantees for the federal funds. Genting turned that down, Habeck said.

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