Mare Island Dry Dock (MIDD), the U.S. shipyard that announced its closure earlier this year, has filed for bankruptcy reorganization to save its operations. The company filed for bankruptcy on February 14, seeking business restructuring while also negotiating a sale or shipyard partnership.
MIDD President Steve DiLeo stated, “Ensuring the shipyard’s continued operation is crucial for both the shipyard itself and the local community. Initiating the restructuring process is a key step in facilitating the shipyard’s sale, and this move aims to protect the interests of all stakeholders.”
On January 1, 2026, MIDD announced its closure on its official website: “Due to ‘uncontrollable adverse circumstances,’ we have made the ‘difficult decision’ to terminate all shipyard operations.”
MIDD’s decision to shut down took effect immediately upon announcement, resulting in the loss of 80 full-time employees. Prior to the shutdown announcement, MIDD had already laid off 65 employees in December 2025, but due to the commencement of bankruptcy proceedings, the company was able to retain 50 employees.
Previous reports indicated that MIDD’s closure and bankruptcy stemmed from unforeseen business events, including losing a crucial contract with the U.S. Coast Guard—the failed bid for the repair of the icebreaker “Healy”. This contract directly and significantly impacted MIDD’s financial stability. Despite its best efforts to remedy the situation, MIDD at the time determined that it could no longer continue operations.
Two months after announcing its closure, MIDD has changed its strategy and is seeking to sell the shipyard as a “continuously operating entity”. It is currently in “productive discussions with several potential buyers” and expects the terms of the transaction to meet the requirements of all creditors and maintain the shipyard’s operations.
Furthermore, MIDD is also committed to collaborating with large enterprises and is reportedly in talks with a major organization that plans to expand its shipbuilding business and is interested in conducting repair services at the shipyard.
Steve DiLeo emphasized: “Whether MIDD ultimately chooses to sell or partner with other companies, it will further enhance its competitive advantage. Only by merging with or being acquired by large companies can the shipyard be able to bid for large contracts that it is currently unable to undertake due to its insufficient size.”
According to available information, Mare Island was the site of the first naval base on the U.S. West Coast, and remained the location of the Mare Island Naval Shipyard until 1996. Starting in 2013, MIDD took over and began operating the shipyard facilities, which include two 213-meter-long concrete dry docks and a nearly 400-meter-long quay.
Reports indicate that MIDD once had 1,000 employees at its peak, but its order volume has plummeted by 65% in the past three years.