Infrastrata has announced the acquisition of the Methil and Arnish yards of the collapsed Scottish manufacturer Burntisland Fabrication (Bifab).
Bifab entered administration in December after a Scottish Government decision to remove support for the ailing firm meant the loss of a key contract for wind turbine jackets for the NnG windfarm.
Now Infrastrata will save the two yards on the east and west coasts of Scotland, with hopes of creating hundreds of jobs as the government’s promised wind boom takes off.
It will trade under its Harland & Wolff brand which also has sites in Belfast and Appledore.
The deal, which is worth a total £850,000 depending on performance, does not include the Burntisland site in Fife.
A total of 29 employees are being transferred under TUPE regulations, with those on furlough being brought back to re-establish operations at the sites.
An Infrastrata spokesperson gave the ambitious estimate of creating “over 400 new jobs at the Arnish site and over 600 new jobs in Methil with additional apprentices at both sites”, despite the Bifab history under previous owners of losing work to overseas competition.
For Arnish, that would go well above employment levels seen in recent years, according to local councillor Donald Crichton, and hark back to the yard’s “heyday” of the oil boom in the late 1970s and early 80s. However he welcomed the news of the yard being rescued.
“400 jobs would be well above any recent peak in employment at the yard, I think we have to be very cautious at the moment until we see what transpires”, he said.
“Our desire has always been that there is a sustainable future, sustainable employment at the yard, because it is an excellent facility and we do have a skilled workforce that would be able to take up jobs there.”
The facility has lain dormant since 80 workers were made redundant in 2019, following the end of a contract for the Moray East wind farm.
Scottish Economy Secretary Fiona Hyslop said it is a “welcome development for the future of the workforce”.
The GMB and Unite unions welcomed the move, but underlined that the story to date “has been one of government failure” and pressed for local supply chain clauses to be “in-built at the outset of major contracts” going forward.
Infrastrata said Arnish and Methil would have “particular regard to renewable and defence projects”, describing Scotland as a “hotbed” for major wind farm developments.
The London-headquartered firm pointed to growth in the wider UK offshore wind market, with the likes of BP and RWE winning leases in the latest Crown Estate round this week for the Irish Sea and Dogger Bank area, respectively.
Last year, Prime Minister Boris Johnson announced plans to quadruple UK wind capacity by 2030.
Taking on the Bifab sites would also increase the “probability-to-win rate” by offering clients multiple fabrication facilities, Infrastrata said.
‘Welcome news for Fife and the Western Isles’
Deloitte was appointed administrator of Bifab in December.
At the time, the GMB Union said it exposes the “myth of Scotland’s renewables revolution” and shines a light on “a decade of political hypocrisy and failure”.
Bifab was previously owned by Canadian company DF Barnes, and lost several hotly-contested contracts for Scottish wind farms.
The Scottish Government invested some £37.4million in order to save the business from closure in 2017, and to support delivery of SSE’s Beatrice Offshore Wind project.
Holyrood leveraged that into a 32.4% stake in the business, and also provided an additional £15m loan facility.
However, in October the government said it had “exhausted the options” for financial support.
Unite Scotland Secretary Pat Rafferty and GMB Scotland Secretary Gary Smith said: “Thousands of jobs and billions of pounds have been outsourced around the world when Scottish communities should have been benefitting from these contracts.
“Now the Scottish and UK Governments have been given a reprieve and they need to step-up and support the new ownership. ”
Economy Secretary Fiona Hyslop said the Bifab Infrastrata deal was “welcome news for local communities in Fife and the Western Isles”, adding that the government will work for the “best possible outcome” for the Burntisland Yard, owned by Forth Ports.
She said:“The Scottish Government’s priority has been to support Bifab’s workers and I welcome the announcement that a buyer has been found.
“The workforce has an important role to play in the future of manufacturing in Scotland and I look forward to working with the new owner as it forges a new future for the company.”
Footprint in Scotland
Payments will be made in two phases: £650,000 in cash and a further £200,000 on certain conditions being met.
The second payment will occur if group turnover exceeds £74million over the next 24 months or if consolidated turnover for the Methil and Arnish sites exceeds £40million over that time.
CEO John Wood said: “I am very pleased to have completed the acquisition of the assets of Bifab, which is in keeping with our stated strategy of capitalising on complementary opportunities when they present themselves.
“Whilst the total consideration is not material, relative to our balance sheet size and market cap, it nevertheless is a very important and highly strategic acquisition for InfraStrata.”
The UK-based natural gas infrastructure firm acquired the Belfast and Appledore sites of Harland and Wolff over the last two years from administrators, similarly targeting renewables, oil and gas and defence projects.
Mr Wood added: “With this acquisition, we now have a footprint in Scotland, which is the hotbed for major wind farm projects as well as for shipbuilding programmes.”
The new owners are seeking to enter a 12-year lease for the Bifab yards, expected to complete over the next four weeks.