The second Perini Navi bankruptcy auction has failed, before it even started. No potential suitors submitted bid deposits by the deadline yesterday, according to Italian media. This means that the official auction of the famed Italian builder intended for next week cannot proceed.
Perini Navi has been non-operational for more than a year. In January, a court in Lucca declared it insolvent. This followed a judge rejecting a restructuring plan, plus denying a request by the yard’s then-owners for more time to present alternate restructuring avenues. Court documents revealed that at the end of 2019, the builder was €80.87 million ($98 million) in the red. Furthermore, at the end of the first quarter of 2020, its debt exposure was nearly €100 million ($121.3 million). As part of the insolvency declaration, the court appointed a trustee to safeguard the assets under provisional operations. The assets include facilities in Viareggio (above) and La Spezia, plus land in Pisa. They also include a yacht in build and existing employee contracts—with less than 100 employees left at the time.
The bankruptcy trustee, Franco Della Santa, set an initial opening-bid price of €62.5 million and a fixed security deposit of €10 million. Deposits were due by July 28, with acquisition plans due the following day and the auction set for July 30. However, all the superyacht shipyards interested in acquiring Perini Navi declared the price too high and declined to bid. These included Palumbo Superyachts, The Italian Sea Group, and a joint venture between the Ferretti Groupo and Sanlorenzo. Therefore, Della Santa set a second Perini Navi bankruptcy auction for early October, with bids due by September 29. This time, the opening bid was €53.5 million, though bids within five percent of that reportedly were acceptable, too. Unchanged, however, the required deposit was €10 million.
The lack of bids for the second Perini Navi bankruptcy auction isn’t surprising. For instance, last week at the Monaco Yacht Show, Alberto Galassi, CEO of the Ferretti Group, responded to our questions about the auction by saying he personally believed the price was too high. Moreover, he said, too many questions remained over the number of remaining employees, along with how to augment their numbers. Plus, he indicated it would be quite costly to restart operations, due to Perini Navi having shut down just before the pandemic started.
Massimo Perotti, president and CEO of Sanlorenzo, expressed similar concerns to Italian media earlier this month. “The company has lost in the last 10 years on average 10 million per year, which is a total loss of 180 million in nine years,” he mentioned. “This means that there is a negative goodwill that must be deducted from the assets.”
What’s the next step? The judge overseeing the insolvency may set a third auction date and base price. We also contacted Della Santa for comment, but did not receive a reply by press time.
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