Chinese to scrap QE2

QE2

The QE2, once the pride of cruise company Cunard’s fleet, is to be sold to the Chinese for scrap.

The GBP20m scrap deal follows the apparent collapse of a proposal to bring the ship back to the UK from its present mooring in Dubai, with the intention of turning it into a floating 5-star hotel. Investors had intended to moor the ship on the Thames, opposite the O2 Arena, and had presented a proposal to Dubai World, the owner of the vessel since its purchase for GBP64m in 2007.

However, it now appears that a separate deal has been done with a Chinese breaking yard, and the Daily Mail has reported that a twenty-strong Chinese crew is already on board the ship.

The newspaper quoted Roger Murray of QE2 London, saying, ‘We have been told the ship is going to be put into a dry dock before being taken to an unknown destination in the far east. That is a tragedy because it almost certainly means the QE2 is being sold as scrap. Our investors were going to give GBP20 million for the ship itself, plus GBP60 million for renovation and the cost of bringing the ship back to Britain. But the ship could raise as much as GBP20 million as dead weight scrap, and the Chinese cash would be immediate.’

Alaric Errington, a spokesman for Equity in Finance, the organisation that was leading the investment consortium behind the QE2 London bid, said, ‘This is a fantastic opportunity and we put forward a very commanding commercial proposition that was designed to give Dubai a future return. The QE2 is an icon but our proposal also makes business sense. The cost of renovating the QE2 and bringing it back to the UK is no more than acquiring land in central London to build a luxury hotel.’

Selling the vessel for scrap appears to be at odds with the agreement signed in 2007 by Istithmar, part of the state conglomerate, Dubai World, which included a clause that the ship would not be sold on for at least 10 years, but Dubai World believe that ‘a contract modification could be agreed’, according to the report.

The UK hotel project had the potential to create up to 2,000 new jobs.

 

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