The Scottish manufacturer Burntisland Fabrication (BiFab) is understood to be on the brink of collapse with bosses considering calling in administrators.
A decision by the Scottish and UK Government to remove financial support for the company has left BiFab’s Canadian owner DF Barnes with little room to manoeuvre and unable to “pursue critical solutions” for the future of the firm.
One insider, close to the newly formed BiFab Working Group announced by Scottish economy secretary Fiona Hyslop last week, described the call to administrators as “inevitable”.
They said: “This was always going to happen. BiFab are short of money and they’ve got no work to tide them over.
“I would expect the call will come this week.”
A spokesman for DF Barnes said “no decision” has been taken over whether to call in administrators.
A joint statement by the Scottish and UK Government on Tuesday claimed there was “no legal route to provide further financial support to BiFab”, citing state aid rules.
The firm has three yards in Scotland at Arnish on the Isle of Lewis, alongside sites in Methil and Burntisland in Fife.
A three-page release by DF Barnes parent company JV Driver last week accused the Scottish Government of failing to deliver the financial support it promised when it took over the company.
It claimed there was an understanding the Scottish Government would be the “primary financier” of the company – but said it has “provided less than 50%” of the financing requested.
The statement also conceded that, due to the decision to remove support, a multi-million pound deal to provide wind turbine jackets to the NnG Offshore Wind Farm project “will be lost to BiFab” along with the opportunity to create about 500 jobs.
BiFab was rescued from the brink of administration by the Scottish Government in a £34 million agreement in 2017 before being purchased by DF Barnes in April 2018, although hundreds of jobs were shed.
A loan facility of £15 million was also provided to support working capital at the firm, which at one time employed almost 1,400 staff.
GMB Union Scotland secretary Gary Smith said: “The plight of BiFab has exposed the myth of Scotland’s green jobs revolution.
“It represents our best chance of building an offshore wind manufacturing industry but instead of welcoming 500 jobs to Fife there are real concerns the business could now be put into administration.
“The workers and communities dependent on these yards have fought so hard for a future and everyone was hoping 2021 would finally be the turning point.
“Instead it looks like both Governments are on the verge of burying these hopes just in time for Christmas.”
A Scottish Government spokeswoman said: “We will continue to do everything possible to support the business while recognising the need for us to remain in line with State Aid regulations.
“We have also discussed with the UK Government what support they may be able to provide.
“In doing so, the economy secretary remains in regular dialogue with MSPs, MPs and councillors who have an interest in BiFab’s yards in Fife and the Isle of Lewis.”
