ECONOMY Secretary Fiona Hyslop has blamed the “viability” of BiFab forcing the wind turbine producer into administration as she stressed ministers could no longer intervene.
Mr Hyslop was speaking at Holyrood’s Economy Committee, when she was pressed over the deal agreed to 2018 with manufacturers, DF Barnes to intitially save the business.
The Canadian firm took on a majority share in the three BiFab yards for just £4 - labelled a “rotten deal” by a Conservative MSP.
The deal led to the Scottish Government ploughing £37 million of public money into BiFab and becoming a minority shareholder.
Since the agreement, BiFab has struggled to win contracts – with Ms Hyslop putting the failures down to being “not in a position to have a future pipeline of activity”.
The Economy Secretary said that the Scottish Government propping up the company would have been considered “had they been in a position to have that continuous pipeline”, but said further funding would have contravened EU state aid laws and ministers have ruled out nationalising the firm.
Ms Hyslop said was “very disappointing” that BiFab failed to secure a contract for part of the Seagreen wind farm development in September.
Questioning Ms Hyslop about the DF Barnes deal, Tory MSP Graham Simpson, said: “We, the Scottish taxpayer, get a minority stake in the company and not even a seat in the board, and the Canadian company for £4 gets a majority of the company.
“It seems to me a pretty rotten deal if the taxpayer is putting in the vast amount of money, £37 million plus extra which takes it up to £52 million. You get a minority stake. The other side of the deal £4 for 67 per cent share of the company. That is a rotten deal.”
Ms Hylsop said at that time the only other alternatives were to let the company fail or for the Government to take it into state ownership, saying this was “something that the ministers involved at that point did not want to do”.
She said: “What we were bringing in was their (DF Barnes) expertise, their acumen, their knowledge of the market, that they would be the board that could run the company, that we would not be directly involved in running the company, they would be responsible for that.”
The Economy Secretary insisted that when the deal was done there had been “assurances” from the Canadian firm they could “achieve and deliver major contracts” for the yards.
Ms Hyslop insisted that as a minority shareholder the Scottish Government had been “exhaustive” in considering options to support BiFab.
“We were trying to get them to get third-party investment, to try to find ways of improving their cashflow proposition,” Ms Hylsop said.
She added: “Clearly we wanted that company to be successful under the ownership of DF Barnes and (investment group) JV Driver. That hasn’t happened.”
The administrators are now trying to sell the company as a going concern, Ms Hylsop added.
But she stressed the Scottish Government had expected the Canadian firm, as majority shareholder, to provide greater financial support.
Earlier this month, DF Barnes vice-president Sean Power told the committee ministers had “understood” the company would not be providing a large amount of cash for BiFab.
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