Navantia strikes Harland and Wolff deal at knocked-down priceNavantia strikes Harland and Wolff deal at knocked-down price

The Spanish company struck a hard bargain but, with no other parties in the ring, it could call the shots. Announced Thursday morning UK time, Navantia will acquire the iconic Belfast yard, Appledore in England, and Arnish and Methil in Scotland, for £70 million, far short of the asking price.

About 1,000 jobs were thought to be at risk at the four yards. But thousands more would have been endangered at third party engineering firms and other suppliers.

With its back against the wall, the UK Government not only agreed a lower price but sweetened the deal further by improving the terms of a £1.6 billion contract for three fleet solid support (FSS) ships on order at H&W. The vessels, which will support the Royal Navy’s UK carrier strike group, are to be built in Belfast, Appledore and Puerto Real in Spain, and Navantia is lead partner on the FSS contract.

The UK’s Business Secretary, Jonathan Reynolds, said that closing the deal with Navantia meant that jobs at the four yards would be safe for “years not months”. Asked about the FSS deal, Reynolds referred to ‘minor revisions’ to the contract and ‘more support’ from the UK Government.

Union leaders reacted with cautious optimism. George Brash, the Unite Union’s Regional Officer for shipyard employees in Belfast, described it as a hugely positive move but warned that the devil will be in the detail.

Related:Harland and Wolff declares bankruptcy

Madrid-based Navantia has four shipyards. The south western Bahia de Cadiz yard is its principal facility close to the Strait of Gibraltar; there are two more yards in Ria de Ferrol on the country’s north west coast; and a fourth yard in Cartagena lies in the Mediterranean Sea.