The States of Guernsey has loaned Condor Ferries £26 million to buy a new conventional ferry to serve the Channel Islands.
Both parties will invest £3 million to buy the 125m long vessel, which will be named the Condor Islander when it starts sailing between the islands, UK and France later this year.
The remaining cost will be covered by a government bond, which will be paid back over 10 years.
The deal was announced last month, but Guernsey's Policy & Resources Committee says "significant challenges" arose which meant it was unlikely to be completed as planned.
It then consulted the Civil Contingencies Authority which told the States to step in to ensure the purchase of the ship went ahead.
Deputy Peter Ferbrache, who chairs the CCA, called the deal "essential" for the island to improve the resilience of its supply chains.
He said the decision also had to be made quickly as there are only a few suitable vessels available globally.
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