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Fincantieri/STX France deal completed

Monday, 12 Feb 2018

Italian shipbuilder Fincantieri said it has reached a final agreement to buy a 50% shareholding in French yard in STX France, in a deal also expected create an alliance between the naval shipbuilding industries of France and Italy.

The deal, which values the shareholding at 59.7 million euros, ends a long dispute that strained relations between France and Italy. French President Emmanuel Macron angered the Italian government in summer 2017 by ordering a “temporary” nationalisation of STX France, based in Saint-Nazaire in western France, cancelling a deal in which Fincantieri and another Italian investor had agreed to buy 55%. Fincantieri said in a statement that the new deal “represents an important first step towards the creation of a future alliance in both cruise and military naval sectors.” Paris and Rome are exploring the creation of a Franco-Italian naval shipbuilding group, merging French naval shipyard Naval Group (DCNS) with Fincantieri, a bid to ward off the threat from industrial powers such as China and the United States. Fincantieri had 4.4 billion euros in revenue in 2016, and expects it to grow at least 16% every two years, up to 2020. STX France is the main French yard one large enough to build aircraft carriers and other large warships. Italian Industry Minister Carlo Calenda said that Italian group Leonardo, which supplies land and naval defence electronics and is one of the world’s ten biggest players in the defence industry, would be part of the talks about the new French/Italian naval shipbuilding group.
State-controlled Fincantieri made a bid for STX France, which specialises in building cruise ships, after the French yard was put up for sale because of the financial problems of its previous parent, South Korea’s STX shipbuilding group. Under the terms of the latest agreement, the French state will hold 34.34% of STX, Naval Group 10%, STX employees up to 2.4% and local suppliers up to 3.26%. In order for Fincantieri to take effective control, the French state will lend Fincantieri a 1% stake. Fincantieri will nominate four members of STX’s eight person executive board.