A further lifeline has been given to Waterford with a new fundraising exercise achieved.
This time €120 million will be raised, half of it will be put up by the existing majority shareholders Dr. Tony O’Reilly and his brother-in-law Peter Goulandrys. That is a very large sum of money and suggests some confidence for the future despite very heavy losses of over €200 million.
The German Rosenthal brand and factories will be sold to raise €120 million. This follows a recovery in the German economy and German consumer confidence at a time when the Irish and English are spending less. This is the fifth time that they have had to go to shareholders.
Finance Directors and Chief Executive Officers have changed over the years in what has been a very traumatic time, with hundreds of crystal workers losing their jobs. At times the company found it difficult to raise the necessary redundancy money and these are now being fazed over a year.
The raising of new capital will come as a relief. This follows the Government rejection of a loan guarantee of €30 million. Plans are afoot to develop a retail centre in the old crystal factory that would house various Irish and international designer labels in a type of outlet centre.
This may replace some of the jobs lost in manufacturing recently but is some years off and wage levels would be less than those of craftsmen.
On a positive note we noted over the Spraoi Weekend that Waterford is still a popular place for tourists despite the doomsayers. An improved visitor centre could attract more visitors to the factory, but we do need more luxury hotels in the 4 to 5 star category when this is developed and that should be one of the medium term plans for the city.
Tourist interests and staff at Waterford Crystal will be glad to hear of the latest fundraising effort which will be backed partly by Lazards of London.
It should benefit business and ensure confidence that there will be a continued Waterford Crystal in the city, despite the lowliness of the share price and difficult international economy and weak dollar.
A revival in the dollar in the coming year could see a turnaround at Waterford Crystal and more US spending, but in the meantime things will still be very tight.