TROUBLED engineering firm BiFab, which was bailed out by a £15 million Scottish Government loan just months ago, is facing a fresh threat to its survival after being hit with a multi-million pound lawsuit.
In November hundreds of BiFab workers marched on Holyrood to highlight the risk to their jobs, prompting First Minister Nicola Sturgeon to return from a UN climate change conference in Germany to broker a deal that saved the firm from administration.
Now, with BiFab facing the prospect of running out of work at the end of March, the company has been served with a Court of Session claim from German company EEW, one of BiFab’s co-contractors on the £2.6 billion Beatrice Offshore Windfarm.
Confirming “the ongoing legal proceedings”, a spokeswoman for EEW declined to comment on the value of the claim.
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However, it is understood that the firm is seeking several million pounds in relation to work that both companies have carried out on Beatrice, an 84-turbine wind farm situated in the Moray Firth. EEW supplied the pipes used in all 84 turbines, with BiFab winning a £100 million contract to assemble 26 of them.
Alan Ritchie of the GMB union, which has been heavily involved in all negotiations relating to BiFab’s future, said the legal action has come at a difficult time for the firm, which could be forced to close when its work on Beatrice comes to an end in March.
“The company appears to be confident that it can see off this claim, but a bigger challenge to BiFab is not so much the legal claim but that the [Beatrice] contract finishes in March and there is no other work,” he said.
“We’ve got great concerns about what is going to be done to get work into the yards and this legal action creates another problem.
“The workers are really concerned about their future.”
BiFab employs 1,400 people across its yards in Burntisland and Methil in Fife and Arnish on the Isle of Lewis.
Mr Ritchie said the work being done on Lewis will run out at the end of this month, while the Fife yards only have enough work to keep going until March.
“We’ve sent a letter to the Scottish Government because there are other contracts coming up in the middle of the year that are all in Scotland,” Mr Ritchie said.
“There has to be some sort of role the Scottish Government plays because BiFab is the only yard in Scotland that has the engineering capabilities to do those.”
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According to a spokeswoman, the Government is prepared to again step in to help BiFab secure the work it needs to remain viable when the Beatrice work concludes.
“After helping BiFab to avoid the threat of administration, the Scottish Government has been in regular contact with the company, investors and relevant parties to ensure a strong, sustainable future for BiFab and the people it employs,” she said.
“The Scottish Government and our agencies are working with the management team at BiFab to secure new business and investment in the company, and through this we hope to provide the best means of creating and safeguarding jobs for the longer term for communities in both Fife and the Isle of Lewis.”
However, BiFab is unlikely to get another bailout without new work in the pipeline, with the November rescue package tied up with the company’s work on Beatrice.
After the Government made the £15m available it was able to secure funding from the wind farm’s main contractor, Seaway Heavy Lifting, as well as Beatrice part-owner SSE and BiFab’s majority shareholder JCE Group, a Swedish business.
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The deal enabled BiFab to pay its staff, who had continued to turn up for work even when it looked like the company would not have the money available to cover their wages.
The GMB, which last week met with representatives from Highlands and Islands Enterprise at BiFab’s yard on Lewis, is holding talks with Fife staff this Friday.
“We’ve got a meeting with the workforce at Burntisland on Friday to discuss their fears over what is happening,” Mr Ritchie said.
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