Owners of ferry vow to revive service to Wales
THE OWNERS of the Fastnet Line ferry service between Cork and Wales yesterday pledged to try and revive the service after the company was forced into receivership when it failed to secure a €1.6 million rescue package.
Interim examiner Michael McAteer had been appointed last November to run the Fastnet Line but yesterday lawyers for Mr McAteer informed the High Court that he had been unable to source additional funding to allow the company to continue trading in line with its business plan.
Mr Justice Peter Kelly was told that Mr McAteer was no longer in a position to put together a scheme of arrangement with the firm’s creditors that would allow the company to continue to trade as a going concern.
As a result, the ferry service, which had been suspended since the company went into examinership last November but which it had been hoped would recommence in March, will not now resume sailings, with the loss of seven permanent and 71 contract jobs.
However, Noel Murphy, chairman of West Cork Tourism Co-op Society Ltd, which owns Fastnet Lines, yesterday said the co-op would begin looking at ways of reviving the service as it provides a vital tourist link between Cork and Kerry and south Wales.
“We’ve lost one round of this battle but we’re not going to go away. This is too important for us. Everybody around this project wanted to keep this project going. We’ve lost this round and maybe we’ve lost this ship but we’re not going away,” he said.
Mr Murphy said the co-op would look at a number of other options including chartering a vessel to operate the service on a half-year basis, while they would also look at the possibility of applying for funding to a new European Union initiative.
He said the co-op would assess whether it would be eligible to apply for funding to the €5 billion Connect Europe Initiative, which is being launched in 2014 to help improve transport links that are of strategic importance within Europe.
Mr Murphy said the co-op were confident that the future of the service could be turned around as a viable business plan, based on a six-months service from Easter to September, had been approved by the High Court during the examinership.
Yesterday’s move comes three years after some 300 shareholders in West Cork and Kerry formed a co-op and each pledged €10,000 to buy a ferry to replace the Cork-Swansea Ferry Service which ended in 2006. Since then another 153 shareholders have joined the co-op.
The venture was also supported by Finish bank Aktia Bank and its finance company, Atkia Yritysrahoitus Oy, through the provision of a multimillion-euro mortgage to the Fastnet Line to support the acquisition of the MV Julia for €7.8 million.
The service began on March 10th, 2011, when the 28-year-old ferry – with capacity for 400 cars, 40 trucks and 1,860 passengers – arrived on its maiden voyage from Swansea to Cork amid great optimism for the future.
But yesterday Mr Murphy admitted the company had made mistakes, including deciding to operate on a 12-month basis in its first year of operation, which contributed to the company accumulating losses of about €6 million in its first 18 months.
Padraic O’Kane, management consultant to the West Cork Tourism Co-op, said passenger numbers for the first 18 months were in line with projections at 153,000 but a rise in oil prices had made it difficult for the company to operate.
When the MV Julia began sailing in March 2010, the fuel cost for one leg of the journey across the Irish Sea was €9,000 but this had risen to over €18,000 by the time that the service was suspended last November and it proved a huge burden for the company, he said.
The original business plan envisaged a 65:35 breakdown in passengers between those originating in the UK and Ireland but in reality the breakdown was 80:20, highlighting the importance of the service to the tourist industry of Cork and Kerry, he said.
Mr Murphy pointed out that it was estimated that the service had generated €30 million in direct tourist spending in the Munster region, while it had purchased €7.6 million worth of goods and service in the region.