Two sources with knowledge of the situation said on Tuesday that the German government and the state of Lower Saxony will likely acquire around 80% of Meyer Werft in order to secure the company's future as one of the largest cruise shipbuilders in the world.

Sources who asked not to be named as they weren't authorized to speak to the media said that the plan was to keep the company, which is 229 years old, afloat by allowing the family to retain a 20% stake in the future.

The plan envisages that the federal government and the state governments will each inject about 200 million euro ($223million) in equity and offer state guarantees for 80% the approximately 2.3 billion euro in bank loans required for the company.

A Meyer Werft spokeswoman said that talks about saving the company are constructive and declined to comment further.

Olaf Lies is scheduled to give a speech on Meyer Werft on Wednesday in the Lower Saxony state parliament.

Last week, German Chancellor Olaf Scholz met with workers at the shipyard in northern Germany to assure them that the shipyard will continue to operate.

In August, the company announced that it had received orders totaling 11 billion Euros in recent months. This included from Disney in the U.S.

The shipbuilder has a funding gap of nearly 2.8 billion euro due to delayed effects from a drop in demand during COVID-19. $1 = 0.8965 Euros (Reporting and Writing by Klaus Lauer; Editing Madeline Chambers, Helen Popper).

(source: Reuters)