The two ships of the failed Hawaii Superferry venture were sold at a foreclosure auction to the Maritime Administration (MARAD) for $25 million apiece, according to the Honolulu Star Advertiser:
After filing for bankruptcy on May 30, 2009, Hawaii Superferry agreed to turn over the ships to the Maritime Administration.
The agency had provided two loan guarantees totaling roughly $140 million to help finance the $190 million construction cost of the two ships. The agency paid its roughly $140 million obligation to investors and lenders in December, and sued to foreclose on its interest in the ships as a first-priority mortgage holder.
The agency submitted a $25 million bid for each ship at the auction conducted by the U.S. Marshals Service. No one bid higher, according to court records.
No money is transferring hands with the sale. The agency used the value of its mortgage to back up its bid for the ships. The agency could have driven bidding up to nearly $140 million in total.
Austal USA, the Alabama shipbuilder that built the vessels, and the state of Hawaii, which provided $40 million in harbor improvements, held second and third mortgages.
Austal USA was owed $23 million.
J.F. Lehman & Co., which was founded by former Navy Secretary John Lehman, was the largest private investor in the project. Lehman’s firm, which owns the shipyard that built the Superferry ships, invested $85.2 million in the business.
The Navy Times reports that the ships will most likely be used by the military:
…it was widely expected the ships would be acquired for use by the Navy, which has operated several similar ships. On April 6, 2009, during a press conference to accompany submission of the 2010 defense budget, Defense Secretary Robert Gates noted that, “to improve our inter-theater lift capacity, we will increase the charter of joint high-speed vessels from two to four until our own production program begins deliveries in 2011.” The two additional vessels were widely thought to be the former Hawaii Superferries.
Navy Times also reports:
In response to queries, neither MARAD, nor the Military Sealift Command, which operates MARAD ships for the Navy, nor the Navy could say Oct. 13 exactly what use the ships would be put to under government orders.
Meanwhile, Austal USA’s JHSV program got a boost Oct. 12, when the Navy announced a total of $204.6 million in construction orders for the fourth and fifth ships. The yet-to-be-named JHSV 4 will be built for the Navy, while JHSV 5 is intended for Army use. Both ships should be delivered by the end of 2013.
Austal USA also is building its second LCS, the Coronado. The first Austal LCS, the Independence, was commissioned in January.
The company is in competition with Lockheed Martin to build as many as 51 more LCS ships. The Navy, which has put off a decision several times, expects to announce a winner before mid-December.
Initially dismissed as paranoia, activists’ concerns that the ships were ultimately for military use have turned out to be true.
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