Cammell Laird Loses $74M Conversion Contract

The finale of a long-standing saga is not good news for Britain’s Cammell Laird, which announced that it lost a crucial $74.7 million contract on Wednesday, which is likely to put hundreds of jobs at risk. The company is considering its legal options. The shipbuilder and repairer said the owner of cruise ship Costa Classica, Costa Crociere of Italy -- a unit of U.S. group Carnival Corp -- had terminated a contract for the ship's conversion. Bonds of Cammell Laird tumbled 20 points after the announcement. Cammell Laird said the letter it had received terminating the contract was unclear and that it was taking legal advice to ascertain what impact it had, if any, on the existing arbitration process initiated in November 2000. The company said it was disappointed with the letter as it had been attempting to resolve the commercial dispute amicably. "Cammell Laird maintains its position that it has complied with its contractual obligations and, in the absence of a satisfactory resolution to the dispute, will take all necessary action to protect its commercial position, including recovery of cost and loss of profit associated with this project," it said in a statement. The dispute arose when last November, the liner had been due to arrive for refitting at the docks in Merseyside, northwest England but headed back to Genoa. Croce Crociere said it had delayed the delivery because work at the shipyard was behind schedule. In December, Cammell Laird was said to be hammering out a new agreement to save the project and protect the jobs at risk. Previous reports have said 250 people were being made redundant as a result of the dispute and 700 jobs out of the company's 4,000 workforce were under threat from the loss of the contract. – (Reuters)