The Donegal fishing port of Killybegs has failed to acquire the naval patrol ship, Deirdre, which was decommissioned earlier this year.
The £190,000 auction bid for the ship by an English yacht company, Sea Stream International, has been accepted by the Minister for Defence, Mr Smith, according to his Department. The 30-year-old ship is due to leave the naval base at Haulbowline in Cork Harbour for the last time next month.
It is due to be refitted in Verolme dockyard, and its new owner flew to Cork this week to inspect the acquisition.
Sea Stream International intends to convert it into a luxury yacht for charter work worldwide, and the refit is to continue into the new year.
The vessel has clocked up 500,000 miles in its 28 years of service, and was involved in the search-and-rescue effort during the ill-fated Fastnet yacht race in 1979 when 15 lives were lost.
After its sale at auction by Dominic Daly auctioneers a consortium from Killybegs sought to acquire the ship.
The fishing community initiated a campaign to buy the vessel, and said it would match the £190,000 accepted for it at auction. Its appeal was based on the fact that the sale was subject to ministerial approval.
A committee led by Mr Tony O'Callaghan planned to use it as a conference and exhibition centre, and as a tourist attraction.
