Bankruptcy of MV Werften: At the top of the pyramid

After the insolvency of the MV shipyards, the parent company Genting is now also preparing the liquidation. A look at the past of CEO Lim Kok Thay illuminates his role in the shipyard bankruptcy.

The friendly, elderly gentleman sits relaxed in an armchair and smiles. He talks about his first cruise, how uncomfortable he felt in his dinner jacket when it was over 30 degrees Celsius and how he had had enough of Western food after three days. However, the person interviewed here is no ordinary cruise newcomer, but businessman Lim Kok Thay. With an estimated fortune of $2.5 billion, he is the 11th richest Malaysian on Forbes list and is the ruler of the Genting empire, which has been swept away in recent weeks by the Bankruptcy of his German subsidiary MV Werften hit the headlines.

That interview took place in 2016. It was one of the few occasions when Lim gave Kok Thay a glimpse behind the face of the billionaire businessman. Genting’s cruise subsidiary, Genting Hong Kong, had just bought three shipyards in Mecklenburg and combined them under the name MV Werften. The plan: to make yourself independent of the long delivery times of the shipbuilders. “MV Werften will only have one customer, and that’s us,” said a satisfied Lim Kok Tay in 2016.

Great plans

The entrepreneur was gratefully welcomed, after all he secured numerous jobs in the structurally weak region. At this point, Lim Kok Thay had big plans. After conquering the Chinese cruise market within a decade, the next milestone should now follow: the world’s largest cruise ship, the “Global Dream” for 9500 passengers – built in Mecklenburg-Western Pomerania.

But the slump in business caused by the Covid 19 pandemic changed everything in the cruise sector. Genting Hong Kong recorded $1.7 billion in net losses back in 2020. The company began extensive restructuring to free up capital. The German shipyards were not unaffected by this financial imbalance either.

beginning of January MV shipyards filed for bankruptcy, after the parent company Genting could not agree with the federal government and the state of Mecklenburg-Western Pomerania on the financing to save the shipyard group. The parties involved blamed each other and Lim Kok Thay became the focus of public attention as the head of the Genting empire.

The fact that the rapid insolvency of the MV shipyards felt to some as if the company boss was not fighting enough for the around 2000 employees in his shipyards can possibly be explained by Lim Kok Thay’s own family history. She paints a picture of a man living a life of service to a family empire in which economic success is paramount.

amusement parks, gambling and plantations

The 70-year-old is a very private person, little is known about him. He is said to be an art collector and has three children who also work for the Genting group. Only in 2017 did Lim Kok Thay’s private life make the headlines due to several court cases within the very wealthy family. The proceedings gave unusual insights into the inside of a family clan in which money seems to come first. The family’s reputation threatened to crumble briefly, but in 2019 the dispute was settled with a settlement and never mentioned again.

The family is also central to the genesis of the Genting empire. Lim Kok Thay learned the business from scratch from his father. Father Lim Goh Tong emigrated from China to Malaysia at the age of 19 and created “Genting Highlands” on a Malaysian mountain near the capital Kuala Lumpur, the country’s first amusement park and his life’s work. Over the years, a multi-billion dollar empire has grown that, in addition to gambling and amusement parks, has also invested in the cruise industry, plantations, oil, gas and biotechnology, among other things.

Strict work ethic

Companions describe Lim Goh Tong as a hard-working man who “knew no Sundays”. This work ethic was also passed on to his son, Lim Kok Thay accompanied his father to business meetings from an early age. He completed an engineering degree in London and a six-week management course at Harvard Business School. At the age of 25 he joined the Genting Group. In 2003, Lim Kok Thay completely took over the business from his father, who died four years later.

When asked what he learned from his father, three buzzwords come to mind: “get on with it”, “work hard” and “create harmony”. However, things are not going harmoniously at Genting Hong Kong at the moment. On Tuesday, the ailing company announced that it was preparing legal action for its liquidation. Genting Hong Kong is in an “immediate and significant” financial emergency, the cruise company said.

“There can only be one at the top of the pyramid. I hope I don’t fail in what is expected of me,” Lim Kok Thay once said in a company video. His father was so successful at the top of the pyramid that a statue is dedicated to him in Genting Highlands. In view of current developments, however, it remains to be seen whether his son will receive the same honor.