Financial Turbulence at The Italian Sea Group Triggers Internal Investigation

The luxury yacht builder The Italian Sea Group (TISG) has informed the market that it is facing a serious internal financial issue following the discovery of significant extra-budget costs linked to the management of several yacht construction orders.

According to the company, preliminary internal analyses revealed that a group of individuals within the organization bypassed internal control systems, allowing project expenditures to exceed the budgets approved for specific yacht builds. The identities and full scope of those involved are still being determined as part of an independent forensic due diligence investigation.

The investigation has been entrusted to KPMG, which will review the management of ongoing orders, the company’s financial controls and its internal governance systems. The firm is expected to deliver an initial “red flag” report within six weeks, followed by a deeper review that may extend over several months.

Early findings suggest that some senior executives were directly involved and have admitted responsibility for actions taken without the knowledge of the Chief Executive Officer, the Board of Directors, or supervisory bodies. Disciplinary actions have already been initiated against individuals identified so far.

Financial impact and emergency funding

The unauthorized spending has led to a significant erosion of the company’s cash position, creating a financial strain that required immediate intervention. To stabilize liquidity, the majority shareholder GC Holding S.p.A., linked to CEO Giovanni Costantino, provided a €25 million shareholder loan in February.

The company noted that part of the extra costs had already been reflected in previous financial statements, while the remaining amounts linked to ongoing projects will be accounted for according to standard accounting principles once the investigation concludes.

Operational tensions and labor relations

The financial pressure also affected operations internally. Employee salaries were delayed by eight days due to temporary liquidity constraints prior to the shareholder loan being finalized. This delay prompted a two-hour strike by workers, after which discussions began with local authorities, trade unions and the Port Authority to address the situation.

Despite the tensions, the company stated that it does not expect to resort to government-supported furlough programs, as ongoing yacht construction contracts remain active.

Banking discussions and financial restructuring

At the same time, The Italian Sea Group has begun discussions with banks and factoring institutions to secure additional financial stability and ensure continuity of operations. Meetings with financial partners are expected in the coming days.

The company also confirmed that the approval of its 2025 financial statements will be delayed, as management needs additional time to complete the accounting review connected to the forensic investigation.

Further complicating the situation, the position responsible for preparing the company’s financial reports became vacant following the resignation of the previous manager, and a replacement will need to be appointed before the financial statements are approved.

What happens next

Over the coming months, the company aims to:

• Complete the forensic investigation to determine the total amount of unauthorized spending
• Identify all individuals responsible for bypassing internal controls
• Negotiate with yacht owners regarding cost overruns on ongoing projects
• Restore financial stability through bank negotiations and governance improvements

The company has committed to updating the market as soon as verified information becomes available.

The situation represents one of the most significant governance challenges in recent years for the group, which operates globally in the luxury yacht sector through brands including Admiral, Tecnomar, Perini Navi, Picchiotti and NCA Refit.